Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

PRIVATE BUSINESS

LONDON TRANSPORT BILL

Lords Amendments considered and agreed to.

SURREY COUNTY COUNCIL BILL [Lords]

Bill read the Third time and passed, with Amendments.

CLYDE RIVER PURIFICATION BOARD BILL

Bill read a Second time and committed.

BRISTOL CORPORATION BILL [Lords] (By Order)

Order for consideration, as amended, read.

Bill, as amended, to be considered upon Thursday next.

Oral Answers to Questions — SOCIAL SERVICES

Overseas Pensioners

Sir G. Nabarro: asked the Secretary of State for Social Services whether, having regard to complaints from pensioners living in Fiji, Canaries, Madeira, Malta, France, Italy and Australia, he will take steps to establish absolute parity for state pensions for all eligible British nationals irrespective of domicile ; what estimate he has made of the annual cost of such parity ; and if he will make a statement.

The Under-Secretary of State for Health and Social Security (Mr. Paul Dean): Any person entitled to a British pension can receive it in any country at the rate current either when he left Britain or when he qualified while abroad. We think it right that subsequent increases should be paid only in countries which have agreed to do likewise for persons drawing their pensions here. Arrangements to this effect have been made in reciprocal agreements with 13 countries, including Malta, France and Italy. The additional annual cost of paying the proposed increased rates from September next to all persons drawing British pensions abroad is estimated at about £8 million.

Sir G. Nabarro: Having regard to the relatively small sum involved, could not my hon. Friend pay some attention to the justice of this case? Is not inflation worldwide, often at a higher rate abroad than in this country? Have not these pensioners abroad qualified, by payments over the whole of their working lives, to become eligible? Why should domicile overseas negative what is their due right—to receive the full pension, with increases?

Mr. Dean: I understand my hon. Friend's point. On the other hand, he will appreciate that the amount they have paid in contributions nothing like covers the cost of the pensions which they receive, and the increases must, of course, be met by the existing working population and taxpayers in this country.

Sir G. Nabarro: On a point of order, Mr. Speaker. In view of that unsatisfactory reply, I beg to give notice that I shall raise this matter at the earliest possible moment on the Adjournment.

National Health Service Charges

Mr. Skinner: asked the Secretary of State for Social Services how many letters he has now received on the subject of increased charges for spectacles, &c. ; and what replies he has given.

The Secretary of State for Social Services (Sir Keith Joseph): Up to 1st July, about 90 ; but a small number of letters on other subjects also mentioned optical charges. Replies have explained that the increased charges have shifted the burden of cost from the taxpayer to those users who can afford it, and have been accompanied by more liberal arrangements for helping people with limited means.

Mr. Skinner: Is the right hon. Gentleman aware that one of the letters which he has received is from the Derbyshire Local Optical Committee which describes the imposition of these new charges as Mafia-like cuts on people who, through no fault of their own, have poor vision? As he subscribes to the policy that higher charges lead to greater individual care and attention, may I ask him to explain how people born with poor sight will have their problem solved?

Sir K. Joseph: I do not think I have expressed a policy judgment such as the hon. Gentleman ascribes to me. I have said that this is an increase only for those who can afford it and that the exemptions have been increased sharply.

Mr. Scott-Hopkins: Does my right hon. Friend feel that the number of spectacles dispensed will diminish as a result of these charges?

Sir K. Joseph: It is difficult to be sure of future trends. General experience is that there is a fall after an increase in charges followed shortly by a resumption of the normal trend ; and that I expect to happen in this case.

Mr. Bob Brown: Does the right hon. Gentleman still hold to the point of view he expressed some months ago from the Government Front Bench, that increased

charges for dental treatment are an incentive to people to take care of their teeth?

Sir K. Joseph: That is a different question on which there is a later Question.

Mr. Frank Allaun: asked the Secretary of State for Social Services why he is reducing the age limit for exemption from dental charges, except for dentures, from 21 years of age to 18 years of age ; when he proposes to introduce legislation ; and what representations he has received on the matter.

Sir K. Joseph: In the absence of compelling clinical reasons for retaining the present age limit, I propose to bring it into line with the current age of majority. This has been explained in reply to representations I have received from a number of individuals and bodies. I cannot yet say when the necessary legislation will be introduced.

Mr. Allaun: Is it not an anomaly that if one breaks a leg or has appendicitis one receives free treatment but if one breaks a tooth or has a tooth infection one has to pay half the cost of the treatment? Are not dentists saying that, far from the age being reduced from 21, it should be raised to 25, because otherwise it will discourage regular dental treatment?

Sir K. Joseph: Both parties have thought it made sense to ask about half the population—

Mr. Orme: Both Front Benches.

Sir K. Joseph: —that is, the adults, to pay something towards their dental treatment. Subject to legislation, I am proposing to reduce the exemption age, because there seems to be no clinical reason for keeping it at 21 as opposed to 18.

Sir G. Nabarro: Does my right hon. Friend recall that it is now six months since he promised me that he would step along the corridor to see the Chancellor of the Exchequer and demand an abolition of the purchase tax on toothpaste in order to encourage children to clean their teeth properly? Has he noted that this was omitted from the last Budget? Will he now double along the corridor to get something done?

Sir K. Joseph: My right hon. and learned Friend and I do not behave in that way in demanding things of each other.

Sir G. Nabarro: I wish you would.

Sir K. Joseph: Children are, have been and will be exempted from dental charges.

Dr. Summerskill: Is there not a clinical reason for needing more dental treatment between the ages of 21 and 18 than later in life? It is not a question of the age of majority but a question of dental fact. As dentists have strongly deplored this proposed legislation, should not the Government forthwith abandon it?

Sir K. Joseph: I will read with interest any evidence that the hon. Lady cares to send me to justify her assertion.

Supplementary Benefit (Strikers' and Prisoners' Dependants)

Mr. Ashton: asked the Secretary of State for Social Services what is the total amount of social security benefits paid to dependants of strikers in 1970–71 ; and how this compares with benefits paid to dependants of men in prison.

Mr. Dean: Supplementary benefit payments during trade disputes to the dependants of persons disqualified on account of the dispute for receiving benefit for themselves totalled £4,882,284 in the 12 months ending 23rd March, 1971. I regret that details of payments to dependants of persons in custody are not kept.

Mr. Ashton: Since the Minister cut benefits to strikers' families, do we not now have a situation in which if a man goes to prison for doing something highly illegal, his family is likely to get more benefit than the family of a man on strike, who is doing something legal? Is not this total discrimination against people taking part in industrial disputes? Should not the benefits to strikers' families be level at least with those of the family of a man who is in prison?

Mr. Dean: No, sir. In the case of prisoners, their wives are treated like other women who are on their own. In the case of strikers this is a voluntary act on the part of the individual concerned.

Mr. Bruce-Gardyne: Is it not utter nonsense to make a comparison between the position of those who are deprived of the ability to earn their living by the community and the position of those who voluntarily decide to withdraw their labour from employment, usually for material gain to themselves?

Hon. Members: Oh !

Mr. Dean: I am obliged to my hon. Friend. What is being said from the other side of the House is that we should change what has been the traditional system in this country for many years ; namely, that public funds should not be used for strikers themselves.

Supplementary Benefit (Separated Wives)

Mr. Leadbitter: asked the Secretary of State for Social Services how many separated wives are drawing social security allowances ; what is the total value ; and what proportion this represents of uncollected maintenance orders.

Mr. Dean: I assume the hon. Member's Question is directed to payments of supplementary benefit. From the latest information available it is estimated that in 1970 supplementary benefit amounting to about £53 million was paid to about 129,000 separated wives where it was necessary to pursue a question of liability to maintain. It is not possible to make a reliable estimate of how much of this was in respect of unpaid maintenance orders.

Mr. Leadbitter: Will the Under-Secretary recognise that these figures are very serious? He will recall my representations to him and those of the members of the Hartlepools Lone Parents Association. Will he now accept that this is a very serious problem involving severe hardship, suffering and, in far too many cases, very serious mental illness? In those circumstances, will he seek to introduce legislation to bring about some social justice in this area?

Mr. Dean: I accept that this is a serious problem. The hon. Gentleman will remember the meeting which we had some time ago. Only today I have written to the chairman to give her a progress report. The House knows that the machinery for enforcement is being speeded up and improved to try to ensure continuity of


payment and that the Government are taking other measures, and, in addition to that, this whole problem is within the remit of the Finer Committee.

Sir B. Rhys Williams: Is my hon. Friend considering the possibility of enforcing payment of maintenance allowances by making use of the Pay-As-You-Earn system?

Mr. Dean: My hon. Friend knows that that is not a matter for me, but I understand that there are considerable difficulties in such suggestions.

Mrs. Shirley Williams: As these families constitute one of the most impoverished groups in the community, would the Minister consider placing on the Supplementary Benefits Commission a responsibility for pursuing orders for maintenance and the attachment of earnings, because many wives are quite incapable of doing this for themselves?

Mr. Dean: I am grateful to the hon. Lady for that suggestion, which I will certainly pursue. I remind the House that women who are getting their payments made by the Supplementary Benefits Commission are not themselves suffering because they are getting regular payments week by week.

Family Income Supplement

Mr. Meacher: asked the Secretary of State for Social Services what is the latest figure for the total number of successful claims for the family income supplement.

Mr. Marks: asked the Secretary of State for Social Services how many applications for family income supplement have so far been received ; how many approved ; and what is the estimated payment on those so far approved.

Mr. Dalyell: asked the Secretary of State for Social Services if he will give the total number of successful claims since the family income supplement was introduced.

Sir K. Joseph: By 6th July 43,792 claims for family income supplements had been received : of the decisions so far given 16,844 were favourable and 17,517 unfavourable. It is estimated that the average award is in the region of £1·50 a week.

Mr. Heffer: Swindle !

Mr. Meacher: Will the right hon. Gentleman confirm that, despite a massive advertising campaign costing more than one third of a million pounds, the total take-up of this benefit, with only three weeks to go to the first day of receipt, is still only 10 per cent. of those eligible, which is ridiculously far short of the right hon. Gentleman's declared objective of 85 per cent. and since this illustrious showpiece of Tory social policy—

Mr. Speaker: Order. The hon. Member must not make a speech.

Mr. Meacher: In view of the apparent failure of this policy, will the right hon. Gentleman state what alternative plans he have to remedy family poverty, on which so far he has made very little impact?

Sir K. Joseph: The hon. Gentleman gives the impression that he does not want the extra money to be received by the poorest families.

Mr. William Price: That is untrue.

Sir K. Joseph: That is the impression that the hon. Gentleman gives, and that is true. The amount of money devoted to the advertising campaign has been £60,000, and not a quarter of a million pounds. My objective to obtain a very high take-up remains. Hon. Gentlemen will judge by the developing result over the rest of the year, and I hope that the whole House hopes with me that we shall have success.

Mr. Marks: Is this figure higher or lower than the right hon. Gentleman anticipated at this stage? Would it not have been far better to increase family allowances, as the Conservative Party promised in its election manifesto?

Sir K. Joseph: No proposal to increase family allowances that would be practical politics would put in the hands of those families, especially those with only one child, a sum as big as £1.50 a week on average. As for the first part of the question, I confess that I had hoped that the take-up at this stage would be bigger. But my experienced advisers warned me that the take-up of a brand-new benefit would tend to be slow, particularly in the period before any money had been distributed.

Mr. Dalyell: On what general grounds were the 17,517 declared unfavourable? This seems to be fairly important.

Sir K. Joseph: The question is a very good one. For two-thirds it was because their income exceeded the test limit, and for one-third it was because they were not in what has been defined as full-time work.

Mr. O'Malley: Why did the Secretary of State not explain to the House when the Bill was going through that his advisers were saying that the take-up would be low?

Sir K. Joseph: Slow.

Mr. O'Malley: Either slow or low. Does not this scheme demonstrate once again the undesirability of a massive increase in means-tested benefits that the Government are proposing? Is not the present scheme little but a fraud? Will the Secretary of State confer with the Under-Secretary and ask him to admit that his estimates of an 80 per cent. take-up at the time the Bill went through were absolutely wrong?

Sir K. Joseph: No. My advisers thought that the take-up of a new benefit would be slow, not low. I ask the House to be patient over the next few months and see how this develops. It is very important that we should get this extra money into the hands of the poorest working households. I hope that the whole House will agree with that.

Mr. Orme: The Secretary of State referred to the question of the family with one child. How many such families have qualified under this scheme? Does he recall, as the House will recall, that the late Iain Macleod gave a firm commitment from the Opposition Front Bench that, irrespective of political unpopularity, a future Tory Government would go for an increase in family allowance? Why have the Government rejected that?

Sir K. Joseph: If the hon. Gentleman would care to table a Question, I will certainly give the House details of the distribution between families with one child and those with more than one child. I have already explained that an examination that we conducted when we assumed office revealed that a family allowance increase would have put less

money into the hands of the very poorest working families and no money into the hands of the family with one child for a vast increase in public expenditure and a great transfer of money from husbands to wives.

Invalidity Benefit

Mr. Ashley: asked the Secretary of State for Social Services what is his latest estimate of the proportion of those entitled to invalidity benefit who will be no better off because of an equivalent reduction in their supplementary benefit.

Mr. Dean: It is not possible to give a precise estimate, but it is thought that the proportion who will not benefit from the invalidity allowance because their supplementary benefit will be reduced by an equivalent amount will probably be about one-third.

Mr. Ashley: Is the Minister aware that he is saving six lousy million pounds at the expense of 100,000 people who are not only sick and disabled but actually living on the poverty line? Is his right hon. Friend aware, not only that he should have answered this Question, but that £6 million, which is almost chicken feed to surtax payers, is vitally needed by sick and disabled people ; and is he prepared to reconsider his priorities?

Mr. Dean: The hon. Gentleman is being a little unfair. I think the whole House recognises that a substantial step forward is being taken to help the chronic sick and the disabled this Session. My right hon. Friend has given an assurance that the next step is now being considered, and one of the aspects of that is to consider in what way the arrangements for those on supplementary benefit can be improved.

Retirement Pension

Mr. George Cunningham: asked the Secretary of State for Social Services what retirement pension is payable to a person with an average of 29 contributions per year ; by how much this falls short of 29/50th of the full pension ; and what were the equivalent figures in July, 1949.

Mr. Dean: £2·50, which is 40p less than 29/50ths of the standard rate. In July, 1949, the figures were 65p and 10½p.

Mr. Cunningham: Does the Under-Secretary think that it is fair that people


receiving an already-reduced pension rate should in many cases receive less than they are entitled to on a strictly proportional basis? Does he accept that the differential, as it has of necessity risen since 1949 with the rise in pensions, now needs looking at in this respect with a view to providing an exactly proportional increase, acknowledging that that might mean in some cases a slight reduction?

Mr. Dean: I understand the hon. Gentleman's point, but, on the other hand, there are already 12 rates of benefit and, were we to have a precise proportion, it would involve about 40 different rates, which would mean a very substantial administrative cost.

Mr. Harold Walker: asked the Secretary of State for Social Services what increases would now be needed to restore the purchasing power of the standard retirement pensions to the level at which they stood in November, 1969, immediately after the last increase.

Sir K. Joseph: As measured by the General Index of retail prices between November, 1969 and May, 1971, the single retirement pension rate would need to be increased by 74p to restore the November 1969 rate of purchasing power. The corresponding amount for a married couple is £1·20.

Mr. Walker: Is not it obvious from that reply that the Government have achieved a cut in pensions at a stroke? Is it not clear that the pledged £1 pension increase for the autumn has already been pre-empted? How will pensioners fare in the subsequent two years if the right hon. Gentleman does not take immediate interim steps to prevent their standard of living being further slashed by the Government?

Sir K. Joseph: We are confident that there will be small but useful real increases and additional increases for the very old and the chronic sick.

Mrs. Shirley Williams: Does the right hon. Gentleman recognise that what was first decreed to be the largest increase in pensions ever has now become a small but useful increase? Will he consider introducing an annual review in the present state of inflation, which is having such a terrible effect on pensioners?

Sir K. Joseph: We do not for a moment expect that the present rate of inflation will continue. The Opposition proposed to put into statutory form an obligation to have a two-year review of pensions.

Dame Irene Ward: Will my right hon. Friend accept my statement : thank God that he is in office and not the Opposition?

Mrs. Renée Short: In view of the undertaking in the White Paper on entry into the Common Market to protect the pensioners and others against the undoubted increase in the cost of living if we do go in, can the right hon. Gentleman say how much thought has been given to estimating what that will cost in due course?

Sir K. Joseph: No, Sir. The White Paper says that there would normally be a review due in 1973, and that we shall, of course, take any possible increase due to the Common Market into account.

Unemployment Benefit (Industrial Disputes)

Mr. Bidwell: asked the Secretary of State for Social Services if he is satisfied with the working of the National Insurance Act, 1965, in so far as it relates to procedure to determine the payment of unemployment benefit arising from industrial disputes ; and if he will make a statement.

Sir K. Joseph: Yes, Sir : I consider the procedures normally work satisfactorily.

Mr. Bidwell: Will the right hon. Gentleman undertake to confer with the Secretary of State for Employment, with whom I have had correspondence concerning a stoppage of work at the A.E.C. factory at Southall in a single workshop which resulted in lay-off of a much larger number of workers who have not yet had their cases heard, in spite of the fact that this was at the end of April, because of the cumbersome machinery? Does not this challenge the Tory concept of individual liberty and freedom? These workers are all entitled to have their cases heard singly. If that be so under the 1965 Act, it will take a considerable time under the present machinery.

Sir K. Joseph: Yes. The normal way to make the machinery less cumbersome is by a test case in agreement with the trade unions. On this occasion the trade union did not co-operate with that machinery.

Electrically-Assisted Pushchairs

Mr. Farr: asked the Secretary of State for Social Services if he will make fresh arrangements for the supply of electrically-assisted pushchairs to disabled persons in need.

The Under-Secretary of State for Health and Social Security (Mr. Michael Alison): No, Sir. The initial difficulties have been overcome and the arrangements are now satisfactory.

Mr. Farr: Is my right hon. Friend aware that there is a lot that needs looking at in this problem? First, outdoor electrically - operated patient - controlled chairs are not available under the National Health Service. Second, there has been a considerable hold-up in the supply of indoor electrically-assisted pushchairs. Will my right hon. Friend inquire into this matter, because many people have been waiting for many months due to supply hold-ups?

Mr. Alison: The first part of my hon. Friend's supplementary question is a separate question from the Question on the Order Paper. As to the second part, I admit that there were difficulties, particularly supply difficulties, but we believe that these have now been overcome and that the supply position has been improved.

Mr. Alfred Morris: Is the Secretary of State aware that the supply difficulties cause very serious inconvenience to many severely disabled people? What progress is being made now in giving severely disabled people powered wheelchairs that can be used on the pavement, as envisaged in Section 20 of the Chronically Sick and Disabled Persons Act?

Mr. Alison: I readily concede that some inconvenience and difficulty were cause by the component hold-ups, which were due to matters beyond the control of any of those concerned. The second part of the hon. Gentleman's question is a separate matter. If he would care

to table a Question specifically on that point I should be happy to answer it.

Consultant Gynaecologists

Mrs. Renée Short: asked the Secretary of State for Social Services if he is satisfied wih the number of consultant gynaecologists in posts in each regional hospital board ; and if he will make a statement.

Sir K. Joseph: It is for individual boards to consider how many consultants are necessary in any specialty, in the light of local needs and facilities, but I have already informed boards that more rapid expansion of the consultant grade as a whole is necessary : they will take account of the particular needs in this specialty where there are long waiting lists, and I have advised them that there should be no shortage of candidates for consultant posts in obstetrics and gynaecology.

Mrs. Short: I thank the right hon. Gentleman for that reply. If he will look at the figures that he was good enough to give me in a Written Answer not long ago he will see that in some regions there are only six or seven consultant gynaecologists per million of population. Those are the areas where the ratio is worst. To get continuity all over the country, is it not necessary to improve this ratio and bring it into line with the better areas where the ratio is about nine per million?

Sir K. Joseph: Yes ; the facts are as the hon. Lady has stated them, and I am sure that boards, in response to the information which I have given them, are taking these into account.

Dr. Summerskill: How many of these consultant posts are now vacant, and what steps is the Secretary of State taking to fill them?

Sir K. Joseph: I cannot tell the hon. Lady that now, but I should be glad to give that information in answer to a specific Question. I am discussing with the profession arrangements for joint forward planning of consultant medical staffing with a view to remedying disparities between different regions and different specialties.

Scientology (Foster Report)

Mr. John Hall: asked the Secretary of State for Social Services when he


expects to decide whether to publish the Foster Report on Scientology.

Sir K. Joseph: I have not yet completed my consideration of the report.

Mr. Hall: What special considerations are making it difficult for my right hon. Friend to announce a decision? As it is nearly 18 months since the committee was set up, should not the general public as well as the scientologists themselves know whether there is any justification for the criticisms and accusations that have been made against the scientologists?

Sir K. Joseph: It was not a committee that was set up. My predecessor took the relatively unusual step of appointing one man, a very distinguished hon. and learned Friend of myself and my hon. Friend—the Member for Northwich (Sir J. Foster)—and the result is a lengthy document which I must have time to consider.

Mr. William Price: Will the Secretary of State give an assurance that he will not take as long to make up his mind about publishing the report as the hon. and learned Member for Northwich (Sir J. Foster) did to prepare it without ever having called any oral evidence? Is it not strange that four years after the Ministerial allegations were made against this group of people, whatever the rights or wrongs of it they still to this day do not know the allegations made against them?

Sir K. Joseph: It is for a number of considerations, including some of those, that I think I am right to take time to consider the report.

Pathologists (Lung Disease Postmortems)

Mr. Eadie: asked the Secretary of State for Social Services what progress he has made in his production of advice to pathologists concerning their procedure when undertaking postmortems where lung disease is suspected.

Mr. Dean: My right hon. Friend has no direct responsibility for advising pathologists on the conduct of postmortem examinations. As regards the industrial lung disease pneumoconiosis, I understand that the Association of Clinical Pathologists has advised its members of the advantages of perfusing lungs in which the presence of this disease is suspected.

Mr. Eadie: I thank the hon. Gentleman for his reply, but he gave a specific undertaking during the Committee stage of a Private Member's Bill, and I hope he is not going back on it. Is he aware that we are rather concerned, particularly in the mining industry, that far too much illness is being caused by chest diseases, some of them diagnosed and some not? Is it not a rather sad comment that some of the people who are suffering from diseases not diagnosed are wondering whether, if they die, there will be proper pathological investigation to determine precisely the nature of their disease and whether it would make their cases eligible for industrial injury benefit?

Mr. Dean: I am glad that the hon. Gentleman has asked this Question because it may help to give publicity to the answer which I have been able to give. I assure the hon. Gentleman and the House that there is no question of the Government going back on what I said in Committee. The Advisory Council is considering this whole matter at present, but it is a complicated subject and it will inevitably take time.

Retirement Pensioners (Free Prescriptions)

Mr. Scott-Hopkins: asked the Secretary of State for Social Services whether he will take steps to lower the age for free prescriptions for retirement pensioners from 65 to 60 years of age.

Mr. Alison: No, Sir. The existing arrangements already ensure that help can be given where it is needed.

Mr. Scott-Hopkins: That is not really a satisfactory reply. Does not my hon. Friend realise that many women between the ages of 60 and 65 have special need for prescriptions but they are outside the scope of the answer which he has given? Will he, therefore, look at the matter again and see whether the age could be reduced to 60, in particular for women?

Mr. Alison: There is no evidence that women or men between the ages of 60 and 65 have a special requirement for extra medicine arising simply from that age range. Where income difficulties arise, there are exemption provisions.

Mr. Molloy: But will not the hon. Gentleman acknowledge that his reply will be most disappointing to many people


between 60 and 65 years of age? As successive Governments have invaded the fundamental principle of a free National Health Service, will he not accept that all the labour and administrative paraphernalia involved in charging for prescriptions makes it not worth the candle, and the quicker we get back to the basic principle of a free National Health Service the better it will be for everyone?

Mr. Alison: I note what the hon. Gentleman says. The age exemption provisions are generous, and we cannot overlook the substantial savings which accrue for other benefits in the National Health Service which arise from this source.

Adoption of Children

Mr. Peter Archer: asked the Secretary of State for Social Services if, pending the final proposals of the Departmental Committee on Adoption, he will encourage local authorities to make more use of their present powers under Section 2 of the Children Act, 1948.

Mr. Alison: I am not clear how Section 2 could appropriately be used more widely in these distressing situations. I am sure that the right course is to await the Departmental Committee's final proposals.

Mr. Archer: I appreciate the argument for awaiting the Departmental Committee's report before introducing amending legislation, but does not the hon. Gentleman realise that heartbreak could be ameliorated in many cases if local authorities were a little more robust in assuming parental powers, and will he not give them just a little encouragement?

Mr. Alison: I admit that there is a genuine difference of opinion on whether the powers are adequate. But I take the hon. and learned Gentleman's point that a more robust use of existing powers by local authorities might solve a lot of the problems which we face.

Elderly People, Newcastle-upon-Tyne (Supplementary Benefits)

Mr. Bob Brown: asked the Secretary of State for Social Services what investigations he undertook in order to satisfy himself that there are no elderly people in Newcastle-upon-Tyne eligible

for supplementary benefits who are not receiving them.

Mr. Dean: No investigations have been undertaken for this purpose. Continuous efforts are made to ensure that elderly people throughout the country receive the supplementary pensions to which they are entitled.

Mr. Brown: That is an extremely disappointing reply. The Secretary of State is reported in the Newcastle Evening Chronicle as having publicly said in the city that he was satisfied that there were no old people in Newcastle who needed supplementary benefit and who were not receiving it. Is the hon. Gentleman aware that all thinking people in Newcastle-upon-Tyne, including the principal officer for social services, regard that as a lot of codswallop, and will he prevail upon his right hon. Friend to do much more than he is doing now to persuade elderly people that there is no stigma in seeking supplementary benefit and that it is theirs as of right?

Mr. Dean: I am sure that my right hon. Friend did not say that, because no right hon. or hon. Member is keener than he is to see that those who are entitled to benefits receive them.

Family Planning Association Conference

Mr. Hunt: asked the Secretary of State for Social Services whether his Department is to be represented at the National Conference of the Family Planning Association to be held at the Royal Festival Hall from 20th to 22nd July on the rôle of family limitation, responsible parenthood and sex education.

Sir K. Joseph: Yes, Sir. Members of my Department will be present ; my chief medical officer will be participating ; and I shall address the conference myself.

Mr. Hunt: I warmly welcome my right hon. Friend's support for this conference, but is he aware that there has been a somewhat disappointing response from a number of local health authorities and hospital management committees, and will he agree that it is most desirable that public bodies such as these should identify themselves with the important work and aims of this conference?

Sir K. Joseph: I was not aware of a disappointing response. I hope that local authorities and hospital authorities are busily carrying out the enlarged programme which the Government are helping them to put into practice.

Ambulance Accidents (Compensation to Patients)

Mr. Wallace: asked the Secretary of State for Social Services under what circumstances are National Health Service patients entitled to compensation for injury or death arising from the public service ambulance in which they were conveyed being involved in a road crash.

Mr. Alison: This would be a matter for the local authority concerned in the particular case or for the court if legal action were taken. I understand that it is normally the practice of local authorities to insure against claims in respect of injury to or death of ambulance passengers.

Mr. Wallace: Is the hon. Gentleman aware that if an ambulance driver who collapsed and thereby caused a crash was suspected of suffering some heart trouble, and the coroner's verdict so indicated, the individuals injured or the relatives of persons killed in such an accident would have extreme difficulty in obtaining compensation?

Mr. Alison: Normally, the insurance arrangements which ambulance authorities make would cover such a case, but I shall study the particular contingency which the hon. Gentleman has specified.

Rubber and Plastic Foam (Fire Risk)

Mr. Alec Jones: asked the Secretary of State for Social Services whether he will issue guidance to health authorities over the use of furniture containing rubber or plastic foam in view of their potential fire risk.

Mr. Alison: We are continuing investigation of this question, and health authorities will be kept informed of developments.

Mr. Jones: Does not the hon. Gentleman understand that there is evidence to suggest that fires involving the use of

these foam and rubber compounds, present serious smoke and fume hazards, and that such smoke and fume present in considerable volume in a hospital fire could well prevent the escape of patients?

Mr. Alison: I am grateful to the hon. Gentleman for writing to us in detail about this matter and for the concern which he shows. We have a problem here in combining in comfortable material, which is essential for hospital patients, the qualities of flame resistance. We are trying to develop a fabric for mattress covers which will be more flame-resistant. We are pressing ahead with developments as rapidly as possible. There is a balance of advantage in both directions here to be considered.

Single Homeless Persons

Mr. O'Halloran: asked the Secretary of State for Social Services when he expects to announce a decision on the working party dealing with single homeless persons ; and if he will make a statement.

Mr. Dean: I am not yet able to forecast a date.

Mr. O'Halloran: Will the hon. Gentleman bear in mind the great work which is being done by the Simon and St. Mungo Communities and, perhaps, give them some financial assistance?

Mr. Dean: I am grateful to the hon. Gentleman for mentioning those two voluntary organisations ; there are others working in this field which do excellent work. We are anxious to help them in every way we can with financial and other assistance, and that is one of the ways in which we are tackling this serious problem.

Mr. Alfred Morris: Can the hon. Gentleman say how the total number of hostel places compares with the total number of single homeless people today?

Mr. Dean: The number of lodging houses is tending to decline owing to redevelopment schemes, and one of the projects which the Government have in hand now, in co-operation with voluntary bodies, is a survey of these places to see how many there are and how many more are needed.

Shotley Bridge General Hospital, Consett (Accident Department)

Mr. David Watkins: asked the Secretary of State for Social Services if he is aware that the accident department at Shotley Bridge General Hospital, Consett, has had to be partially closed because of shortage of medical staff, thereby depriving the area of a vital service during certain periods ; and what measures he proposes to restore a full accident service.

Mr. Alison: I am aware of the partial closure. The management committee is seeking to recruit more staff, but the difficulty of staffing accident and emergency departments is a general problem which my Department is currently discussing with the medical profession.

Mr. Watkins: I thank the hon. Gentleman for that reply. I can confirm the local efforts to which he has referred. Is he aware that it is an area of round-the-clock working in heavy industry, such as steel-making and coal-mining, where accidents are only too tragically likely to occur? Does he therefore realise the seriousness of that deprivation, and will he take urgent measures to seek to remedy it?

Mr. Alison: The hospital management committee expects to appoint a locum senior house officer, which should improve the service, as from 1st August.

Over-70 Employees (National Insurance Contribution)

Mr. Lipton: asked the Secretary of State for Social Services what weekly national insurance contribution is payable by a male employee over 70 years of age and his employer ; to what funds are such contributions' credited ; and what benefits accrue to the employee.

Mr. Dean: As the reply contains a number of figures, I will, if I may, circulate them in the OFFICIAL REPORT.

Mr. Lipton: The reply does not contain such a large number of figures that the answer cannot be given now. Is not it a fact that a large sum is paid out in such cases for which there is no substantial return to the employee concerned, and that this deters employers from employing such people?

Mr. Dean: The employee in this case pays only 4p for the industrial injury scheme, which gives him cover whatever his age—even the 70-year old.

Following is the information :
A male employee over 70 pays £0·04 and his employer £2·15. The employee's contribution goes to the Industrial Injuries Fund and of the employer's contribution £0·754 is credited to the National Insurance Fund, £0·05 to the Industrial Injuries Fund, £0·083 towards the National Health Service, £0·063 to the Redundancy Fund and £1·20 is Selective Employment Tax. The employee normally draws retirement pension and may qualify for benefit under the Industrial Injuries Act for an accident at work ; and he also, of course, comes within the National Health Service, though this does not accrue from the payment of contributions.

Walsall General Hospital (Children's Admissions)

Mr. William Wells: asked the Secretary of State for Social Services what is the average delay in admitting children for surgical treatment, other than in emergency, at the Walsall General Hospital ; and how this period compares with the average in the area of the West Midlands Regional Hospital Board as a whole.

Mr. Alison: This information is not available since separate waiting lists are not maintained for children.

Mr. Wells: Does the Minister realise that for the gynaecological services the delay in Walsall is double that in the rest of the area of the regional hospital board? Will he make further inquiries to find out whether the delay to children is the same? Will he do all in his power to bring the Walsall standard at least up to the standard of the rest of the region?

Mr. Alison: I note the hon. and learned Gentleman's point. I understand that at the Walsall General Hospital last December 643 patients of all ages were awaiting admission for general and orthopaedic surgery, a decrease of 66 on the figure for 1969.

Construction Industry (Self-Employed Persons)

Mr. Costain: asked the Secretary of State for Social Services what progress he has made in his review of possible reclassification for national insurance purposes of self-employed persons in the construction industry ; and whether he will


give an assurance that he will consult fully with the industry on this matter.

Mr. Dean: Officers of my Department have met representatives of the C.B.I. and employers in the industry and of the T.U.C. Consultations are continuing.

Mr. Costain: My hon. Friend's action is fully accepted by the industry. Will he continue his negotiations?

Mr. Dean: I am much obliged to my hon. Friend, and I gladly give him that assurance.

Oral Answers to Questions — RHODESIA

Sir G. Nabarro: asked the Prime Minister whether he will arrange an official meeting with Mr. Ian Smith shortly, having regard to the Goodman consultations.

The Prime Minister (Mr. Edward Heath): I have no plans to do so.

Sir G. Nabarro: Does my right hon. Friend recognise that yesterday's answer by my right hon. Friend the Foreign and Commonwealth Secretary was stodgy and indigestible? As the policy of sanctions is now seen to be a total failure, will not my right hon. Friend consider holding out an olive branch by at least withdrawing naval patrols that serve no further useful purpose?

The Prime Minister: No, Sir. I cannot accede to my hon. Friend's request. My right hon. Friend repeated yesterday that the discussions have been going on to find out whether it is possible to reach a basis for negotiation. I am sure that that is the right way of dealing with this difficult problem. At the same time, the existing measures will remain in force.

Mr. Harold Wilson: The right hon. Gentleman will have seen or read the script of Mr. Ian Smith's broadcast on "Panorama" last night, and will form his own views on the immediate prospects. Will he consider a proposal which he put to me when our rôles were reversed, and which received a favourable answer, that if there were any substantial change in the Rhodesian situation during the Summer Recess Parliament would be recalled? Will he give the same assurance to me as I then gave to him?

The Prime Minister: Of course, I would consider that. If there were any major change in the Rhodesian situation, I would give the right hon. Gentleman the same reply as he gave me. I have read the script of last night's programme, but I do not propose to comment on it. It is better for us to rely on the discussions which have been taking place.

Mr. Wilson: I agree with the Prime Minister's last remarks, but, just to clear up any doubt, since he said that he would consider such a situation and then said that he would give me the same reply as I gave him, and since that reply was that Parliament would be recalled, can I interpret the last part of his answer as meaning that if there is a substantial change in the Rhodesian situation Parliament will be recalled, and that its recall will not merely be considered?

The Prime Minister: Yes, Sir. As the right hon. Gentleman has always said, the exact nature of the change, if any were to come about, would be a proper subject for discussions between him and me in the usual way as to whether Parliament should be recalled. Obviously, if there were any major change Parliament would have to be recalled.

Mr. Thorpe: Contrary to the view of the hon. Member for Worcestershire, South (Sir G. Nabarro), is the Prime Minister aware that in referring to the five principles the Foreign and Commonwealth Secretary made it quite plain—and this carries a degree of support throughout the House—that in his view principles mean principles?

The Prime Minister: Yes, Sir, and in the script I read of Mr. Smith's television appearance last night he himself said that the five principles were a matter of principle for the present British Government.

Oral Answers to Questions — EUROPEAN ECONOMIC COMMUNITY

Mr. Skinner: asked the Prime Minister whether, following the Luxembourg Agreement, he will seek a further meeting with President Pompidou.

The Prime Minister: I have at present no plans for a further meeting with President Pompidou.

Mr. Skinner: Is the Prime Minister aware that if he does go to see his French master again he could take advantage of a tutorial? He could also take his latest essay, Cmnd. 4715. I am sure that President Pompidou would give it top marks for its abstract generalisations. Perhaps the right hon. Gentleman will first tell the British people why regional policy is dismissed in six sentences in the White Paper, and, more important still, what will be the real cost to the balance of payments.

The Prime Minister: Regional policy does not exist in a Community form in the Community. Therefore, individual countries follow their own regional policy. The Commission is only at the earliest stages of formulating a regional policy. If any progress is made before the end of the negotiations, we can discuss it in the negotiations, and after that it can be discussed under the general arrangements for consultation during the interim period before the transitional period begins. As I have already told the House, we do not discriminate against other countries in the implementation of our own arrangements for regional policy. Any firm from another country which wants to come to a special development area or a development area receives exactly the same treatment and inducements as a British firm. Therefore, the policy is not against the principles of the Community.

Mr. Gardner: Could my right hon. Friend, from all his experience of past meetings with representatives of the Common Market countries, tell this House—because it would be of great assistance, no doubt, for the forthcoming debate—whether he has met anyone from any one of the Six countries who has expressed regret that his country joined the Common Market, or anyone who has expressed a wish that his country should apply to leave it?

The Prime Minister: I would obviously begin by making the stipulation that the number of people that any one person, Minister or otherwise, can meet is limited. But my experience, and that of many other right hon. and hon. Gentlemen, is that I have not met any organised body or member of a political party opposed to his own country's membership of the E.E.C. Indeed, one of the notable things

is that even the Communist parties in Europe have been notably reluctant to criticise their countries' membership of the E.E.C.

Mr. Heffer: May I come back to the question of regional policy? Is the Prime Minister aware that a proposal is being made by the Commission suggesting that in a broad central belt investment schemes should be abolished and replaced by investment grants but with a ceiling of 20 per cent? Is the right hon. Gentleman aware that for areas like Merseyside and the North-East coast, which could well be included in that broad belt, such a system would be disastrous from the point of view of development?

The Prime Minister: I have already told the House that the Commission is in the early stages of formulating a policy It has not yet come to the Council of Ministers. I have explained the arrangements under which we would be able to influence that policy if Parliament agreed that we should join the E.E.C. The objective of the E.E.C. in this matter seems reasonable, because it is the same objective as we have through our export credits guarantee scheme. It is to stop individual countries trying to outbid each other for investment. That would be to our advantage in the same way as the general arrangement for export credits, since we have created greater attractions for firms to invest in this country, and I do not see why we should have our arrangements outbid by other members of the Community.

Mr. Roy Jenkins: While I accept that the policy is at the very early stage of formulation, may I ask whether it would not be unacceptable to many people if it were to prevent the North-East coast and Merseyside being assisted in a way that is desirable? Will the right hon. Gentleman assure us that if at the end of the day it appears that the investment policy of the Labour Government towards the development areas is more acceptable in Brussels than that of the Conservative Government, he will not be inhibited by any party dogma from producing the most effective policy from the point of view of the development areas?

The Prime Minister: The right hon. Gentleman has, naturally, got more


speedily to the point than his hon. Friend. I could not understand why the hon. Member for Liverpool, Walton (Mr. Heffer) was complaining about the E.E.C. proposing a system of cash grants for investment. If we felt that it was in the interests of the Community, that it was an acceptable arrangement, no doubt we would express our agreement. It is obviously far too early to discuss individual areas with the Community, for the simple reason that the Commission and the Council of Ministers have not yet reached a policy. So far as we are concerned, obviously the areas mentioned by the right hon. Gentleman and also Scotland and Wales are of vital importance to us.

Mr. Leadbitter: asked the Prime Minister if the statement made by the Minister of Agriculture, Fisheries and Food on the television programme, Farming Outlook, on 27th June, 1971, referring to price increases in steps to meet European Economic Community levels, represents the policy of Her Majesty's Government.

The Prime Minister: Yes, Sir.

Mr. Leadbitter: Does the Prime Minister know that the answer to Question No. 34, put to the Secretary of State for Social Services earlier today by my hon. Friend the Member for Don-caster (Mr. Harold Walker), indicated that the rise in pensions to be introduced on 20th September is now eroded and that, at the present level of price increases, it will be eroded further? Is the right hon. Gentleman aware that further price increases in order to reach Common Market levels will introduce excessive hardship in this country, particularly for those with average incomes and below and those on social security allowances and retirement pensions?

The Prime Minister: Perhaps the hon. Gentleman will listen to the answer to a Question and not merely to the Question itself. If he does in this case, he will see that the situation was explained by my right hon. Friend. There is an undertaking in the White Paper—and a similar undertaking was given by my predecessor when the point was raised with the last Government—that the two-yearly review of all social service benefits, to which we are pledged, will take note of

any changes as a result of entry into the E.E.C. As the first increase in food prices is expected to take place between April and June, 1973, and we are also pledged to a review in 1973, that review can take note of those increases.

Mr. John Wells: Is my right hon. Friend aware that both he and my right hon. Friend the Minister of Agriculture, Fisheries and Food have from time to time implied, perhaps unwittingly, that the price of fruit and vegetables will fall to the housewife if we go into the E.E.C. whereas this, in truth, is perhaps not so? The cash received by the growers will be less but the price actually paid by the housewife will probably be about the same. Could he look at those statements again very closely before they are reiterated?

The Prime Minister: I am prepared to examine any statements, but they are not made unwittingly. The fact is that this country has a better distribution system than most of the existing members of the Community. That is why the statement appears in the White Paper—on the best advice that we have been able to get.

Oral Answers to Questions — WAR PENSIONS

Mr. Onslow: asked the Prime Minister if he is satisfied with the co-ordination between the Department of Health and Social Security and the Ministry of Defence on the up-rating of war pensions ; and if he will make a statement.

The Prime Minister: Yes, Sir. Arrangements are now well under way to pay the largest cash increases ever proposed to the nation's half million war disablement pensioners and war widows. Arrangements are also in hand to introduce the new invalidity allowance for unemployable war pensioners ; to provide a war widow's pension, irrespective of cause of death, where a war disabled husband had been receiving the constant attendance allowance at the normal maximum rate or above ; and to pay age allowance for war widows at age 65.

Mr. Onslow: That reply will be most welcome to all who take an interest in the welfare of war pensioners. Is my right hon. Friend satisfied that the preferential treatment which war pensioners


have always, rightly, been able to get from the community in the past will be fully maintained?

The Prime Minister: Yes, Sir. As I understand it, preferential treatment has been given by Administrations of both parties, and it is our intention to maintain that situation.

Mr. Merlyn Rees: Since the number of war pensioners is getting smaller, just as those left are getting older all the time, has the time not come to have a full-scale inquiry into the whole nature of war pensions, since we have, happily, not had a world war for more than 25 years? From my experience, I believe that it is time to look at the whole subject again.

The Prime Minister: The hon. Gentleman has great experience in these matters and I will consider his suggestion. It has not hitherto been put to me. My right hon. Friend the Secretary of State for Social Services has been trying to improve the situation in regard to the special requirements which have been pointed out to him. I will consider the hon. Gentleman's suggestion that there should be an overall review.

Mrs. Shirley Williams: Will the right hon. Gentleman confirm that the invalidity allowance will be paid to war pensioners, even those drawing supplementary benefit, unlike the case of the rather mean deduction to be made from civilian pensioners? Will he also confirm that war pensioners will be protected against rising inflation in a way not being done for civilian pensioners?

The Prime Minister: I do not accept the latter point made by the hon. Lady. I would like notice of the first part of her supplementary question, since it is a detailed point and I wish to give an accurate answer.

Oral Answers to Questions — AUSTRIAN FEDERAL CHANCELLOR (VISIT)

Mr. Deakins: asked the Prime Minister if he will invite the Prime Minister of Austria to pay an official visit to the United Kingdom.

The Prime Minister: The Federal Chancellor would always be welcome in this country, but there are at present no plans for a visit.

Mr. Deakins: Would not such a visit be apposite at present since the White Paper does not make any mention of the fact that when we made our application in 1967 we were going to support the interests of our E.F.T.A. partners, who did not seek full membership, and there is no sign in the White Paper that we are intent on doing this before we become members ourselves?

The Prime Minister: It has always been accepted that each individual E.F.T.A. country will negotiate itself for whatever form of arrangement it wants with the Community. This has always been the wish of the E.F.T.A. countries over the last 10 years, and that is still their position. It is up to them to choose what form of arrangement they want and to negotiate it, if possible, with the Community. Originally, in 1961, there was an undertaking from the then Conservative Government that the E.F.T.A. countries would all enter the Community at the same lime and would be responsible for safeguarding each other's infests. That undertaking was abandoned in 1967 with the second application and has not been renewed.

Mr. Jeffrey Archer: Does my right hon. Friend realise that there are many of us on this side of the House who are full of admiration for the courageous stand made by the right hon. Members for Fulham (Mr. Michael Stewart) and Dundee, East (Mr. George Thomson) and that some of us look to the Leader of the Opposition to make the same courageous stand and put the country before his party?

The Prime Minister: My hon. Friend is perfectly entitled to express his view, but I would not wish in any way to cause embarrassment to those who are supporting a cause which I sponsor.

HOUSING FINANCE

The Secretary of State for the Environment (Mr. Peter Walker): Mr. Speaker, with permission, I wish to make a statement on the reform of housing finance in England and Wales.
In my statement of 3rd November, I informed the House of the broad principles of our reform of housing finance. We have discussed the details of our


plans with the local authority associations and the voluntary housing movement. The proposals which we have formulated in the light of these discussions are set out in a White Paper—Command No. 4728—which my right hon. and learned Friend the Secretary of State for Wales and I are presenting to the House. Copies are now available in the Vote Office.
For the first time in our history, there will be a national rent rebate scheme for all unfurnished tenants under which a rent rebate or allowance will be available to those tenants who need help to pay a fair rent for the house that they occupy. This will mean that 2½ million tenants in the private sector will for the first time have a rebate scheme available. It will mean also that council house tenants in authorities which do not at present have rent rebate schemes—that is, almost 40 per cent. of all authorities—will now be covered by a scheme.
Let me give an example. Take a council house tenant with a wife and two children who lives in a house with a fair rent of £4 a week. If his gross income is £25 a week, he will then get a rebate that will reduce his rent from £4 to about £2·70 a week. For those on very low incomes in relation to their family responsibilities, the scheme will provide a full rebate of rent so that they will pay no rent at all. When the scheme is introduced, many council and private tenants will meet less of the rent of their dwelling than before.
The White Paper proposes the replacement of the existing subsidy system by a new system to give a fresh stimulus to housing authorities and associations which need to go on building and to clear slums. If an authority incurs a deficit on its housing revenue account because it builds new houses for people now living in slums, Exchequer subsidies will meet about 75 per cent. of the deficit. In addition, if the authority makes a loss on the slum clearance operations itself, an entirely new slum clearance subsidy will meet 75 per cent. of that loss. In order to give an immediate momentum to slum clearance, we have decided that this new subsidy should be retrospective to the beginning of the present financial year.
I have already announced in my statement of 3rd November that the fair rent

principle will be applied to local authority dwellings and extended more rapidly to private controlled tenancies. The White Paper now makes it clear that the rent increase for council dwellings which are now below the fair rent will be phased in annual steps. The average annual increase will be 50 pence a week, subject to transitional arrangements for the period up to 31st March, 1973, which are explained in the White Paper. When a private tenancy passes out of rent control and the registered fair rent is substantially higher, the increases in the rent of the tenancy will be phased in three equal annual instalments.
The Government intend to introduce a Bill early in the next Session of Parliament to give effect to the proposals in the White Paper. These proposals will create a system of housing finance which is fair to all concerned and which concentrates help on people and areas in need.
My right hon. Friend the Secretary of State for Scotland will be presenting a White Paper tomorrow which will contain his proposals for the reform of housing finance in Scotland.

Mr. Crosland: We shall want to study the White Paper and we shall want a debate at the earliest possible moment, and in Government time. Many of the implications of this statement are profoundly reactionary and will affect the level of inflation, the rate of house building and the distribution of income. I have these specific questions to put to the right hon. Gentleman.
First, will the Secretary of State confirm that at the end of three years the average rise in rents will be £1·50? What does he think will be the social and economic consequences of such a huge rise in so short a period? Secondly, will he estimate what proportion of tenants, under fair rents, will be eligible for rent rebates? Is it, as many outside commentators have suggested, half or more than half—in other words, means testing on a mass scale for the first time? What effect does he think this will have on incentives about which his party is always talking? Thirdly, what does he estimate the effect of this will be on the rate of council house building at a moment when, despite all the constant, misleading and optimistic statements of the Government, council


house building faces a bleaker future than for a long time?
Lastly, while I am strongly in favour of owner-occupation—[HON. MEMBERS : "Oh."] It was the Labour Government who introduced the option mortgage scheme, and it was under a Labour Government that for the first time 50 per cent. of householders became owner-occupiers. Therefore, I repeat, while I am strongly in favour of owner-occupation, can the right hon. Gentleman in equity defend a system under which owner-occupiers alone receive open-ended and non-means-tested help at a time when millions of council tenants will be subject to a means test for the first time and at the same time face an increase in their rent of so large a character, if not at one stroke, at any rate three strokes?

Mr. Walker: As to the suggestion about our proposals being reactionary, there are 2½ million tenants in the private sector who will not consider that making a rebate scheme available to them for the first time is particularly reactionary. As to rent increases, I remind the right hon. Gentleman that during the period of the last Government rents in the public sector rose by 65 per cent. But I hope that the right hon. Gentleman will make clear to the country the proposals which his Government were preparing concerning the rent structure. They were not published before the election, but perhaps the right hon. Gentleman would tell us what they were.
As to the means testing of large numbers of council house tenants, I remind the right hon. Gentleman that under the previous Government 1,350,000 tenants were either obtaining subsidies through social security, means tested, or were in existing rent rebate schemes, means tested. So what the right hon. Gentleman has said is complete hypocrisy.
As for council house building, my announcement that the slum clearance subsidy will be retrospective to the beginning of this year will give a considerable momentum to tackling slum clearance, whereas the subsidy system operated by the Labour Government resulted in large numbers of towns and cities, particularly in some of the older industrial parts, almost stopping their slum clearance programmes. This will now change. [HON.

MEMBERS : "Answer."] Socialist councils—

Hon. Members: Answer.

Mr. Speaker: Order. Hon. Members have repeatedly shouted "Answer". The Minister should be allowed to answer.

Mr. Walker: Councils of all complexions will welcome the very substantial slum clearance subsidy in these proposals which will stimulate the right type of council building. We know the position of the Labour Party on home ownership. It is very much in line with that of a party which slashed council mortgages to the extent that it did.

Mr. Longden: Whilst congratulating my right hon. Friend upon introducing this revolutionary system whereby those who can pay for what they need and those who cannot are helped by their fellow citizens, may I ask whether the White Paper will include a provision whereby those small investors who have put their money into real property rather than stocks and shares will at long last be able to get a return which will enable them not only to keep their properties in repair but also to get a fair return for their money?

Mr. Walker: It certainly will mean, with the phasing over to fair rents, that many of these people will obtain a fair rent at long last, but not at the expense of poorer tenants, because a rent rebate scheme will be available.

Mr. Charles Morris: The White Paper has just been made available to hon. Members in the Vote Office, and paragraph 52 in regard to rent rebate says :
The allowance will be based on only a proportion of the fair rent if the dwelling is much larger than the tenant requires or is situated in an area of high property values.…
Does the Minister accept that this paragraph will bear heavily on elderly council house tenants?

Mr. Walker: No, the limitation is a total ceiling at the very top of the scale to stop absurd abuses of the rebate system. I can assure the hon. Gentleman that it has no such effect as he suggests.

Sir R. Turton: I congratulate my right hon. Friend on his far-sighted plan, but will he give an assurance that the working of housing associations will be encouraged, bearing in mind that the


houses which they are providing are chiefly for the elderly, who are in great need of houses?

Mr. Walker: My right hon. Friend will be pleased to know that there is a special section on housing associations. We intend to make the rent rebate scheme available to them, and, in order to encourage responsible and successful housing associations, under the proposals a new subsidy will meet for ten years up to 90 per cent. of the deposit for new building schemes when expenditure exceeds income from fair rents in the first four years. In total, we believe that this will give considerable encouragement to housing associations.

Mr. Pardoe: Although I welcome almost any statement which may sweep away the excuses which many local authorities have used for not building houses over the last few years, is the Minister aware that the net result of his earlier statement in November was a complete collapse of optimism throughout the construction industry? Is he further aware that, in view of recent estimates about public sector housing, many hon. Members on both sides of the House would think that his proposals today fall far short of the level necessary to restore optimism?

Mr. Walker: I hope the hon. Gentleman will have noticed that in the first few months of this year we have been clearing slums at the rate of 700 a month faster than last year. Only yesterday it was announced by the building industry that new starts in the owner-occupied sector for the first six months of this year were 30 per cent. up on last year.

Mr. Raison: I congratulate my right hon. Friend on his excellent statement, but will he give an assurance that he has closely consulted the Secretary of State for Social Services to make sure that the concentration of rebates and benefits on those with very low incomes is not such as to have a disincentive effect on them earning more?

Mr. Walker: Yes, Sir. These proposals are on the basis of a 17 per cent. tapering effect, which produces a minimum disincentive. I have been in close consultation with my right hon. Friend.

Mr. Hugh Jenkins: Will the right hon. Gentleman look again at mortgages? As one who is buying his house on mortgage, I am conscious that under his proposals there will be no means test for me or for any member of his party. One prominent member of his party has a mortgage of £26,000 on a very large house, which means that he is, and will continue to be, largely subsidised by the State. Will the right hon. Gentleman look into this gross unfairness and recognise that the scheme he has put before the House is divisive of the nation.

Mr. Walker: It is the intention on this side of the House to encourage home ownership, and I hope that all local authorities will give freedom to their tenants of council houses to take advantage of the incentives to owner-occupation.

Mr. Biggs-Davison: Will my right hon. Friend tell me by how much on an average council house rents were increased under the last Administration?

Mr. Walker: By 65 per cent.

Mr. Heffer: Will the right hon. Gentleman tell us exactly how the rent rebate will be calculated? Will it be based on the income of the tenant, or will the calculation include the earnings of everyone in the household, including teenagers?

Mr. Walker: There is a complicated formula for this. I refer the hon. Gentleman to the White Paper, where he will find that the rebate scheme is far more generous than the one recommended to local authorities by the previous Government.

Mr. Evelyn King: Will my right hon. Friend confirm, as I think must be the case, that at the end of three years the proportion of gross income paid in rent is likely to be far less than it was two or three years ago?

Mr. Walker: I have not done the calculations on this.

Mr. Frank Allaun: Does this mean that all rent control for private landlords' houses is now ended? Secondly, does not this mean more than doubling the rent for a vast number of houses? Is not this a deliberate increase in a major item in the cost of living? Lastly, is


this not just a redistribution of subsidy but a net reduction which amounts to a substantial rent increase?

Mr. Walker: On the first point, control will continue of rents controlled under the fair rent formula devised by the last Government, and also security of tenure remains complete in this section. On the second point as to the increase in rents, many tenants, particularly in places like Salford, will probably as a result of these proposals, with their rebates, be paying lower rents than before. It is therefore completely wrong to suggest that there will be an increase in rents. The redistribution means that instead of having £200 million of subsidies only £1 in £10 of which goes directly to help those in need, we are having £200 million of subsidies the whole of which will go to help people in need.

Mr. Kenneth Baker: I congratulate the Secretary of State on one particular aspect of the White Paper, and that is the substantial increase in slum clearance grants which will be of great benefit to inner London boroughs. I ask my right hon. Friend to redouble the efforts he is presently undertaking to speed up slum clearance within the Inner London boroughs and to bring to their attention the generous grants mentioned in the White Paper.

Mr. Walker: Yes, Sir. I hope that my announcement today that the slum clearance subsidy will be made retrospective will result in local authorities immediately going ahead with substantial programmes.

Mr. Carter: Is the Minister aware that, far from being welcomed in the country, his statement today will be received as a barbaric and savage attack on the principle of public sector housing? Is he not aware that in the country as a whole this new principle of a national rent rebate scheme will be interpreted as the poor keeping the poor?

Mr. Walker: It is, if I may say so, not something that will be greeted in that way by people in the private sector who have never previously been entitled to a rebate, or by people living in the areas of the 40 per cent. of local authorities who have no rebate scheme. The hon. Gentleman's remarks come ill from a party which, when in government, sent

round a circular urging local authorities to adopt a rent rebate scheme far less generous than the one I have announced today.

Mr. Chapman: As one who believes sincerely that had these policies been introduced 20 years ago there would not have been slums, obsolescence and overcrowding today, may I ask how many families my right hon. Friend estimates will receive rent rebates under his scheme, compared with those who would have received rent rebates under the scheme of the previous Government?

Mr. Walker: It is difficult to estimate this accurately, but quite certainly very substantially more, because 2½ million tenants in the private sector, which include many of the poorer households in the country, will receive benefit.

Mr. Marks: Who will provide the funds for rent rebates for private tenants? Will fair rents be assessed by rent officers or by reference to gross rateable value?

Mr. Walker: In regard to the second point, rent officers ; the answer to the first point is 100 per cent. by the Exchequer.

Mr. Costain: Could my right hon. Friend explain why it is that whenever any scheme is put forward to enable people to live in decent houses and to get a rent rebate the Opposition scream "means test", when in fact each time an income tax form is filled in it amounts to the same thing?

Mr. Walker: I think my hon. Friend will find that when right hon. Gentlemen opposite publish the proposals which they had in mind before the election it will be seen that their policies will not be all that much different.

Mr. Freeson: Could the right hon. Gentleman clarify one or two points which have become a little obscure in the course of some of his replies? In answer to a request for information about the cut in the total ceiling, he referred to a figure of £200 million. Is it still the Government's intention, as announced by the Chancellor of the Exchequer last year, to reduce by the middle-1970s the total projected expenditure on regional spending from £370 million to about £200 million and to hold it at that level rather than to expand it? On the question of


the total global figure, could the right hon. Gentleman say what estimates he or his Department have made of the total surplus or "profit" which will accrue to the housing revenue accounts throughout the country as a result of the new policies he has proposed in the White Paper?

Mr. Walker: On the first point, the figure will be kept at present levels and will not increase to the levels originally estimated under the old subsidy scheme ; but as the previous Government were carrying out a review of housing finance, presumably they had something like this in mind too.—[HON. MEMBERS : "No."] The right hon. Gentleman is free to publish his party's policy on rents, and the sooner he does so the better we shall be pleased. On the second point, I cannot give the estimated total so far as subsidies are concerned.

Mr. Julius Silverman: The Minister makes much of the question of rebates in the private sector. Has he examined the experience of the city of Birmingham which alone so far promoted a Private Bill to provide for rebates to private tenants, but which has discovered that the number of rebates which have been given, out of a total of about 60,000 estimated private tenants, amounts in all to a few hundred. Is he not grossly overestimating the benefits which this scheme will give to tenants in the private sector?

Mr. Walker: No, Sir. The rent scheme in Birmingham was an interesting and important experiment, but it was very different from the rent rebate scheme which we are introducing.

Mr. Blenkinsop: Why does not the Secretary of State answer the question put to him as to how many tenants will pay excessively high increases in rent following his proposals, and why does he intend to cause local authorities to undertake rent rebate schemes whether or not they wish to do so?

Mr. Walker: It is vital to provide a rent rebate scheme for everybody concerned in the country. If the hon. Gentleman is suggesting that the rents are outrageous. I will point out that they are the rents agreed by the previous Government as being proper.

Mr. Harold Wilson: The right hon. Gentleman has three times made accusa-

tions about the previous Government's policy, contrary to the usual convention of proprieties as to what papers were available to a previous Government. [HON. MEMBERS : "Oh."] Will he produce his evidence that any right hon. Member on this side of the House when a Minister had approved any such policies? Is he aware that I can categorically state that all my right hon. and hon. Friends in the right hon. Gentleman's former Department will confirm that no policy whatever was decided by those former Ministers on the lines of what has now been put forward? [Interruption.] Hon. Members opposite may laugh, but this is a serious matter of housing and of governmental proprieties. Would the right hon. Gentleman now produce the sources of his evidence? Will he take it from my right hon. and hon. Friends that there have been no such decisions, but that where proposals were put up—he cannot know this, but I will tell him—on the lines of his White Paper, they were rejected by the former Government?

Mr. Walker: The previous Government announced that they were carrying out a review of housing finance. They gave a reason for that review, namely, that they wanted to see that help went to those concerned. They spent many months on that review and, surprisingly, they did not come to any publishable conclusions before the date of the General Election. In spite of constant pressure from our side of the House at the time when we were in Opposition seeking an announcement about the conclusions resulting from those many months of work, the previous Government were unable to come to those conclusions. It is remarkable that the previous Government spent months in not coming to conclusions and that the present Government have taken two months to analyse the situation.

Mr. Harold Wilson: The right hon. Gentleman is now talking a very different language from when he began. Three times he said that we had come to conclusions and did not announce them. The right hon. Gentleman is now sliding back to the position that what we did was to spend some time examining the situation—and so we did. We rejected the facile and reactionary proposals he has accepted. Will he now withdraw?

Mr. Walker: I stated and I repeat—

Mr. Carter: Spiv.

Mr. Walker: I categorically state that I know of no conclusions reached by the previous Government. [Interruption.] I was stating my belief as to the conclusion they would come to. But now at last the right hon. Gentleman has the unique opportunity to tell the country and Parliament what his conclusions are.

Mr. Harold Wilson: I take the opportunity to tell Parliament that what the right hon. Gentleman said was a total misrepresentation of the position and he should withdraw it. The right hon. Gentleman should further recognise that matters of housing, which affect millions of people, are not matters for the slick approach he has shown today. I hope that when the right hon. Gentleman studies HANSARD tomorrow he will consider making a personal statement to the House. I will not press him this afternoon. But will he now answer the question put at the outset by my right hon. Friend? Could the House have a debate in Government time before the recess—this White Paper has been produced only two or three weeks before the recess—in which we do not merely have to accept the policy which he has outlined this afternoon but in which the whole House concerned with different points of view on housing may examine the Tightness or wrongness of the right hon. Gentleman's proposals? Could we have an answer to that question?

Mr. Walker: This is a question for my right hon. Friend the Leader of the House. But as far as I am concerned, I would welcome a debate, because I am dying to hear the right hon. Gentleman's views.

NEW MEMBER

Nicholas Guy Barnett, Esquire, Member for Greenwich, made the Affirmation required by Law.

DRUGS AND POISONS (CHILD-RESISTANT CONTAINERS)

4.0 p.m.

Mr. Greville Janner: I beg to move,
That leave be given to bring in a Bill to make it unlawful to supply drugs or poisonous substances otherwise than in child-resistant containers.
It is estimated that about 25,000 children under five will be accidentally poisoned in the coming year in this country. Although perhaps less than 100 will actually die, no one knows how many of the rest will suffer permanent injury to the liver, the kidneys or the mind. This is an important and growing problem which has not been dealt with properly by any Administration. Over half the children who will be poisoned will in fact suffer as a result of swallowing medicines and drugs which were not in child-resistant containers. These are only the figures of admissions to hospital and there is still perhaps the same number treated by general practitioners or their parents who form no part of this unpleasant and largely unnecessary statistic.
The number of poisoned children is growing. In Leicester, in the whole of last year, there were 145 admissions of poisoned children aged under 5 to hospital. By the end of June this year there were already 139. In the circumstances, there is no substitute for parents or those in charge of children keeping these dangerous objects away from them, preferably locked up, but we must face the fact that people are careless and we must make carelessness more difficult.
Many of today's containers can open simply by being shaken. Pills may empty into a mother's handbag without her being careless. In some cases it is not possible to buy child-resistant containers from chemists even if one wants them. So even the parent who wishes pills to be kept in a child-resistant container may have no means of getting one.
So far as there is an answer, it lies partially in the compulsory provision of child-resistant containers. There is no perfect container, but I have a collection of various objects which some adults—some sitting beside me—have found not at all easy to open. Some are very


cheap and cost a fraction of a penny more than the ordinary containers available today. Others cost several shillings, but in either event, if they save lives and prevent the poisoning of children, their enforced use is surely elementary.
The cost to the National Health Service has been given as the main reason for non-introduction. We are told that this cost may be about £500,000 per annum. If we take even 10,000 children going to hospital for even 48 hours each at £10 a day, we have a figure of £200,000. If we add the number of days lost from work by anguished parents, we reach a sum likely to be far in excess of £500,000.
In any event, this cost should not be totted up in terms of money. Where children's lives are involved, even if this Measure saved 50 lives, 10 lives or only one life, it is worth putting on the Statute Book. With some 10,000 children a year being poisoned through the failure to supply pills in child-resistant containers—and with the increase in poisoning growing at the present rate, this is very likely—this Measure will, I hope, commend itself to the House.
There is no reasonable alternative to these containers. We know that they are not perfect ; some are not moisture-proof. Research is going on. In Leicester, Dr. Matheson, consultant pediatrician at the Leicester Royal Infirmary, is to publish a paper. But we cannot wait, and parents who see their children poisoned see no good reason why we should wait.
Also, those parents are often too ashamed of their carelessness to apply public pressure, but pressure is coming—from the medical profession, pharmacists, chemists and their trade paper and from hon. Members on both sides of the House.
I appreciate that, in the present state of Parliamentary time, this Measure is likely to have a short life, but at least I hope that it may be born alive. If it is, it will show the concern of the House about a serious and growing national problem. If I am given leave, parents will know that this is a matter which concerns us all. It will show that hon. Members are not prepared to let it rest until there is this minimal legislation for the expenditure of this comparatively trifling sum to save money and children's lives and, for far greater numbers, children's health, and to prevent anxiety and unnecessary strain and illness affecting so many thousands of our constituents.

Question put and agreed to.

Bill ordered to be brought in by Mr. Janner, Dr. Vaughan, Dr. Dickson Mabon, Mr. David Steel, Dr. Shirley Summerskill, Mr. Arthur Davidson, Mr. Goodhart, Mr. Bradley, Dr. Miller and Mr. Dykes.

DRUGS AND POISONS (CHILD-RESISTANT CONTAINERS)

Bill to make it unlawful to supply drugs or poisonous substances otherwise than in child-resistant containers, presented accordingly and read the First time ; to be read a Second time Tomorrow and to be printed. [Bill 213.]

Orders of the Day — SUPPLY

[26TH ALLOTTED DAY],—considered

Orders of the Day — SCOTLAND (ECONOMIC SITUATION)

Mr. Speaker: Before I call the right hon. Member for Kilmarnock (Mr. Ross), I would inform the House that I have selected the Amendment standing in the names of the Prime Minister and his right hon. Friends.

4.8 p.m.

Mr. William Ross: I beg to move,
That this House condemns Her Majesty's Government for the failure of its economic policies, which have led to the highest level of unemployment in Scotland in post-war years and increasing hardship for the people of Scotland.
It is nearly 13 months since the people of Scotland decisively rejected the policies of the party opposite, and, at every democratic opportunity which they have had since then to express a political view, they have demonstrated that they have not changed their minds. In these intervening months, virtually an unbridgeable gap has been created between the people of Scotland and this Tory Government. Their credibility with the people of Scotland has gone. I do not blame just the Secretary of State, although he must accept his part of the responsibility for the deeds and misdeeds of his Government, but I see that it has been said that the present Government have effectively dug the grave of the Tory Party in Scotland.
We condemn this Government for their indifference, their neglect, their callous disregard for the needs of Scotland and their complete mishandling of the situation. The facts are beyond dispute. In the month of June, we had the highest unemployment figure for any June month in the post-war years. The fact is that unemployment in Scotland always rises between June and July. There is a reason for it. But we face a worsening situation, not just next winter, but next summer. We shall have the latest unemployment figures next Thursday. It may be that the Secretary of State is in a position to give

us an estimate of what the figures are likely to be. I think that they will shock the whole of Scotland.
The situation is worsening month by month compared with the position a year ago, and we have no effective action from the Government. We have no indication from them that they are seriously concerned, although I notice that in the Amendment they propose to move, they talk about the figures being "regrettably high".
Comparing January of this year with January of the previous year, unemployment in Scotland showed an increase of 19,000. In February, the increase compared with the year before rose to 27,000, in March to 31,000, in April to 34,000, in May to 35,000, and in June to a figure which was 37,500 higher than it had been the year before. That is a staggering increase, and it is worsening month by month, with the Government totally inactive.
Right hon. and hon. Gentlemen opposite will say that they inherited the situation. That is what we were told in February. They said that they inherited a situation of 80,000 unemployed in summer time. What will the right hon. Gentleman say now when, as a result of his racing round Scotland like a frightened rabbit, the figure is 121,000 and likely to rise still further?
Hon. Members have to appreciate that, in Scotland, between 76,000 and 80,000 children leave school each session. They do not all leave at the end of the session which, this year, closed at some time between 23rd and the end of June. Many of those children will be registering as unemployed. Of those who leave during the year, probably about 40,000 or 50,000 will do so at the end of the summer session. Many of them will appear on the register in the month of July and in the figures that we are to be given next Thursday.
In Scotland, we face the prospect of 130,000 unemployed in the month of July. Anyone who has studied the relationship between winter and summer unemployment figures can guess easily what will happen. It is too late for any action, even any action that is likely to follow the announcements which I have no doubt that the Secretary of State will be making today. Inevitably, the unemployment


figure will rise to at least 150,000 in the month of February next year, and the chances are that it will be very much higher.
All that the Government can say is, "Please, Sir, it was not us." They have now been in office for 13 months. For four of those months they said nothing ; they went into hibernation. However, they were aware of the problem. They were wringing their hands in despair when unemployment was half what it is today and saying that something should be done. For four months, they said nothing. Then, on 27th October, we had a statement from the Chancellor of the Exchequer.
Some people seem to have forgotten about that statement. We had an echo of it today in the Government's statement on their housing policy. That was foreshadowed in the statement on 27th October when they suggested that by the middle 1970s they would save between £100 million and £200 million on housing subsidies, and that the figure for Scotland would be between £10 million and £20 million.
What were the important things done for Scotland then? We were told that investment grants, which were almost the lynchpin of development in Scotland, were to end. R.E.P. was to be not tapered off or phased out but brought to an end in 1974. For Scotland, investment grants in the previous year had meant £75 million, cash. R.E.P. had meant £60 million.

Mr. Ian MacArthur: How much in S.E.T.?

Mr. Ross: The hon. Gentleman will be able to talk about S.E.T. in a few weeks' time, when he sees exactly how prices tumble. I am always surprised how people forget the way in which S.E.T. was taken off Highlands hotels and other hotels in different parts of Scotland. There was no drop in prices. If the Gentleman wishes to take comfort from what is likely to happen to S.E.T., let him look at what was said in the Glasgow Herald last week—

Mr. MacArthur: Mr. MacArthur rose—

Mr. Ross: No, I shall not give way. The hon. Gentleman is good at interrupting everyone else's speech—

Hon. Members: Give way.

Mr. Ross: No. The hon. Gentleman no doubt will have an opportunity to make his own speech later on. We have plenty of time.
So there we have the position, with investment grants finished and with R.E.P. to go—

Mr. MacArthur: And S.E.T. halved.

Mr. Ross: But that was not all. There was the slashing of the nationalised industries' programmes by £43 million, starting this year, and rising in three years' time to a cut of £73 million. A closing date was put into the programme for building new hotels. Then there was the menace threatened, which has now become reality, of the slash in housing subsidies which local authorities have been discussing with the Secretary of State for many months. Every single item was guaranteed to have an effect upon the Scottish economy and upon investment.
I am sure that the right hon. Gentleman remembers what he said at the time. On 28th October, the day following, The Scotsman said this :
Mr. Gordon Campbell, Secretary of State for Scotland, insisted last night in a statement that the refashioning of incentives for regional development without any reduction of the money for development areas would be an impetus for Scottish development. The new methods would be more effective.
That was October. The Secretary of State must be in despair about the position of the Scottish economy today. No doubt the right hon. Gentleman has had a copy of the magazine Scotland sent to him. He should read the business page, which says :
It is a long time since the outlook for the economy looked bleaker. At the risk of being boringly repetitious, action by the Government is long overdue if we are not to drift helplessly into recession and crisis … Of all the manifestations of our economic ills none is more worrying than the chronic low level of investment.
That is not the only publication to confirm the pessimism of right hon. and hon. Gentlemen on this side of the House. On the same day, The Scotsman said :
… it seems that if the economy ceases to stagnate, the resulting benefits for Scotland could be substantial, but if economic inertia continues, then she could well be worse off.
We are worse off. Generally speaking, the responsibility for this situation lies


not just with the Secretary of State but with those who are in command of the whole economy. Inertia has continued despite what the Government did in October and despite what they did in the Budget.
The Secretary of State can point to special development areas and all the rest, he can have all the local Employment Acts and special development areas he likes—indeed, he can have all the incentives he likes, although the present ones are pretty poor compared with the direct incentives which we gave—but if there is no mobile industry and no confidence in the country, he will not get the development, the movement or the expansion of industry.
Todays Financial Times, under the heading,
No signs of upturn in U.K. production",
goes on to say :
There are no signs of an upturn in U.K. industrial output. The May production figures which became available yesterday, show a fall from April's, and in the three months March-May production was lower than in December-February.
So far from advancing, we are going down
If right hon. and hon. Gentlemen opposite do not like that newspaper, I refer them to The Times of today, which says :
… the Treasury's mid-year economic assessment should now have served that purpose. It will have painted a picture of stagnation in both current expenditure and investment. … The measures that the Government did adopt either failed to have any discernible impact on demand, such as the reduction in income tax, or were actually deflationary in their immediate effect, such as "—
mark these words—
the shift from investment grants to investment allowances.
Everyone in Scotland, from Lord Clydesmuir to the S.T.U.C., is saying exactly what we told the Government in October would happen : that they would dry up the impetus to development in Scotland by the change from investment grants to allowances. It must have made good reading for the Secretary of State if he read The Guardian leader this morning, which says :
Scotland's winter wind… Unemployment is already as bad as it could possibly be.
The writer of that article does not know the Tories, because there is worse to come. When the English used to talk

about going back 40 years to find their worst unemployment figures, we used to be able to say that we had only to go back to 1963 when a certain right hon. Gentleman was the President of the Board of Trade. That right hon. Gentleman is now the Prime Minister, and he has not lost his touch when it comes to Scotland. The first six months of 1971 have proved the most disastrous period that Scotland has had. Right hon. and hon. Gentlemen opposite cannot get away from the fact that this is the result of their misled and misguided but calculated policies. The Prime Minister himself on Scottish television, when attacking the incentives which we gave, said that they were over-generous. But they were effective. He was saying that we did not need them. What did we want? A soup kitchen economy in a soup kitchen country?
We had another indication today of the madness of right hon. and hon. Gentlemen opposite. They have means test madness : means tests for rents for council houses, means tests for rents for private houses, means tests for school meals and school milk, means tests for welfare services, for rent rebates and for rates rent rebates. It is means tests, means tests, means tests. Scotland's economy is drifting towards ruin, and right hon. and hon. Gentlemen opposite know it. It is not just the lame ducks. Redundancies in Scotland were being declared at the rate of 6,500 in the months of April and May, despite this great new impetus towards development.
What did we get in I.D.C's? In April and May jobs prospects from I.D.C's granted under the great new system amounted to 754. Yet nearly 12 times that number of redundancies were being declared as new jobs were being created. But new jobs being created—

Mr. James Hamilton: Cremated.

Mr. Ross: —have a habit of disappearing in the pipeline. I nearly said "cremated". I probably would have been right. There is no doubt about the redundancy notice. Workers receive redundancy notices and on the same day their place of work is closed.
Into this situation we have the hacking policies of the Government relating to


the steel industry. They held up an announcement, which was made and authorised in January, 1970, that the Ravenscraig development was going ahead ; but, with the interference of this disengaging Government, we got the announcement last week after 18 months of delay. The hacking of the industries connected with the steel industry has created gloom and despondency throughout industry generally.
Let us consider the activities of the Secretary of State for Trade and Industry, not the Minister for Trade, who, I understand, is winding up the debate today. However, I welcome his return to the scene of, dare I say it, his former triumphs with the Scottish economy. The Secretary of State for Trade and Industry ought to be here, because that industrial anatomist has been very busy. He has had the enthusiastic assistance of the hon. Members for Cirencester and Tewkesbury (Mr. Ridley) and for Bournemouth, West (Sir J. Eden), the like of which we have not witnessed since a celebrated anatomist in Edinburgh engaged the services of Burke and Hare.
It was into this situation that U.C.S. fell. I will not rehearse that sad story. We have already, through questions and the answers we have received, built up an interesting dossier of comings and goings and of information being sent. Indeed, we know from the report which was prepared on 9th December by the hon. Member for Cirencester and Tewkesbury just how all that was done concerning U.C.S. was calculated, planned and laid down in December 1969. This is one of the saddest and most disgraceful stories that has ever come out about a Government Department's activities. I hope that my hon. Friend the Member for Glasgow, Craigton (Mr. Millan) will add one more date to that dossier : that just after that statement made by the Secretary of State for Trade and Industry on, I think, 4th November the credits for U.C.S. were held up. In other words, the lame duck policy was put into operation.

Mr. T. G. D. Galbraith: The right hon. Gentleman complains about what he calls the "lame duck" policy. Will he explain to the House the criteria on which he would give help to ailing companies? Would

it be to all companies, or just specially favoured companies?

Mr. Ross: That is a very good question. I am sure that the attitude which the Secretary of State adopted when the Cabinet discussed U.C.S. was the same as mine. What is involved is not just the 8,500 jobs at U.C.S., but 20,000 jobs elsewhere, because nowadays most of the work of a shipyard is assembly work, while the main work is done by outside suppliers. Every effort should therefore be made to ensure that U.C.S. is kept in existence. We should remember the statements about U.C.S. being on the road to viability and the improvements in its launchings and contracts. It could have been saved. If one balances any question of doubt against social consequences, one realises what should be done. It has rightly been said that U.C.S.
is fast becoming a symbol of Scotland's economic plight …
There is no doubt that U.C.S. should be saved, but hon. Gentlemen opposite took the decision to butcher the company before they became the Government.

Mr. MacArthur: Rubbish.

Mr. Ross: That was the advice given by the hon. Member for Cirencester and Tewkesbury, and the existence of that report has never been denied. The hon. Gentleman drew up the report. The Secretary of State said that he never saw it. Perhaps I may tell him that his name was on the circulation list. He was one of two Scottish Members to whom the report was to be sent. It may well be what the right hon. Gentleman did not receive it or did not read it. Or it may be that even as a member of the Shadow Cabinet he was not brought into these consultations on the future of the shipbuilding industry. If that is so, that is even worse than admitting that he had seen the document. It is an indictment of the right hon. Gentleman's position in the Conservative Party.
We are now faced with the position that the whole of Scotland is in uproar about U.C.S. I have never before seen a march such as that which I saw in London of unemployed workers and people whose jobs were threatened. There were men from the shipyards. There were ministers from the Church of Scotland, priests from the Roman Catholic Church and men from local authorities. When the march was repeated in Glasgow it proved to be


the most disciplined demonstration that we had ever seen against a Government decision.

Mr. Galbraith: What about Greenock Dry Dock?

Mr. Ross: The hon. Gentleman should appreciate that the financing of that dock was done by his Government. If he wants to know anything about it, he should read the report of the Public Accounts Committee. The hon. Gentleman should realise that Greenock Dry Dock is still in existence and is being used. Let us hope that after the four wise men have finished and the recommendations have been made to the Government the whole of U.C.S. will be fully employed. If that is going to be the outcome of U.C.S., they should never have embarked on these proceedings. I have said before, and it is true, that the Government will spend far more on U.C.S. than it would have taken to obviate the whole position. The action was the result not of policy but of dogma. It is only one facet of the Government's policy which has created this gulf between them and the people of Scotland.
Not very far from U.C.S. there is a place called Alexandria, which we fought to save when the Ministry of Defence decided that it had to give up the work that was being done there. I can remember the weeks of work put in by officials of the Scottish Office, by Ministers, and by officials from the Ministry of Technology and the Ministry of Defence. I remember how we managed to get Plessey to take over that factory. One deciding factor in that decision was the ability to use the machinery and the people who were there. About 18 months ago there was talk of increasing the number employed there to 2,000. Today that factory is being closed.
I think that there is room for two inquiries in Scotland. There should be an inquiry into what happened about that factory. It is time that we had a public reply to my hon. Friend the Member for Dunbartonshire, West (Mr. Ian Campbell), who has asked some pointed questions about this matter. This factory itself is important to the area in which it is situated, but it has become even more important following the considerable improvements in the road pattern of the area, thanks to the work of the Labour Government.
I should like to know what the Secretary of State did about that. When we have a Government who do not believe in intervening, a Government who are actively engaged in disengagement and in leaving everything to private enterprise, we realise that the outlook for the people of Scotland is dismal, bleak and grim. What did the Government do about Plessey, and what are they going to do about this factory?
The excuse given by Plessey was that it had to safeguard its industries in the south. Are we to understand that that is to be the pattern in future, and that all regional policy has been thrown overboard? Regional policy does not begin and end with local employment Acts. It must be seen in every sphere of Government influence. It must be seen in what the Government do about the nationalised industries to ensure that the special bias that is required is given to the development areas. One of the sad things is that the Government have not used their power, through the nationalised industries, either to reflate the economy or to give discriminatory reflation where it is required. That is certainly something that they could do.
There is also the problem of Hunterston. The hon. Member for Bute and North Ayrshire (Sir F. Maclean) may have been pleased with what happened at Hunterston, but the deep-water facilities there are unique in this country and they must be used for the advantage of the people of Scotland. There was a time when the Clyde was a rural river, but we have seen the changes that have occurred in the whole pattern of trade, both incoming and outgoing.
I remember how when the idea was first mooted elaborate proposals were put forward by Glasgow University and the Scottish Council—Oceanspan. The development of Hunterston was first suggested in relation to the steel industry. The ore terminal was urgently required because of the expansion of the industry and the future of the general terminus quay at Glasgow. Following the inquiry we waited for months and months, but we heard nothing at all from the Secretary of State. The right hon. Gentleman says "No" by instalments. He says that he has zoned the area, but he refused Chevron for the purpose of industrial development. It is not to be left to the


local planning authority to decide who shall go to an area. If the right hon. Gentleman cannot agree to Chevron, what can he agree to?

Sir Fitzroy Maclean: The right hon. Gentleman has accused my right hon. Friend of being negative in his attitude. All that he has said "No" to so far is an American oil company which would have brought few jobs but done a great deal of damage to amenities. I remind the right hon. Gentleman that he did the same thing, and I think quite rightly, in respect of Murco.

Mr. Ross: The hon. Gentleman is entitled to his opinion. I would rather that he did not impute opinions to me.

Sir F. Maclean: I did not.

Mr. Ross: The hon. Gentleman said that I had done the same thing in respect of Murco. That is not true. Let him read the reports and he will find that they do not compare. [Interruption.] I can assure "Mr. Europe"—

An Hon. Member: Who is he?

Mr. Ross: The right hon. Gentleman went to Bonn once and the Scottish Press said : "Here is Mr. Europe". Instead of going to Bonn the right hon. Gentleman ought to go to Bonhill and see what sort of reception he meets there. I can assure hon. Gentlemen that if the two decisions are compared they will be found to be entirely different. What will happen about Hunterston? When will we get an approach from the British Steel Corporation and the Clyde Port Authority about the ore terminal? Is this something else which is being delayed by the cutting down of the grants foreshadowed in the statement of 27th October about port modernisation?
We are anxious to hear about this, because a terminal would be the first step. I hope it is one of the things that the right hon. Gentleman will announce today. We want to hear him say that he will give the go-ahead for the construction of an ore terminal at Hunters-ton. If we do not get that terminal we shall never get a steel complex there. One of the most engaging things about the right hon. Gentleman is that he endowed his shadow interventions with an aura of Eastern prophecy. About 1963

he suddenly discovered the existence of Hunterston and its unique facilities. Indeed, he claims to be a pioneer about this. He talked about the steel complex there, instancing what was being done elsewhere and seemed to think that there should be a speed-up of decision-making. We think so too.
There was no indication of that from the Secretary of State for Trade and Industry the other day. Many fears are being expressed in Scotland today that the new growth point in Britain is not to be Hunterston but Foulness, Shoeburyness and Southend-on-Sea. It is interesting to note that while Scotland is being fobbed off with an experimental rifle range from Shoeburyness which Wales refused to have, the Shoeburyness area is being developed with the construction at Foulness of an airport which will cost £150 million more than if the airport had been sited elsewhere.
We know that the V.A.T. office is not going to Wigtownshire or Glasgow, or Edinburgh, or any development area. It will go to within a few miles of Shoeburyness. Is this the new development area policy of the Tory Government? We have seen the easing up of I.D.C. policy—and there will need to be a considerable easing up to allow that kind of development. It is depressing that we spend years and years, pressing Governments and Cabinet colleagues, getting accepted the idea that priority should be given to the regions and then suddenly within a few months of a new Government all is lost and the regional policies come virtually to a halt.
The right hon. Gentleman takes a pride in saying, "We created the special development area policy"—

Mr. Galbraith: On a point of order, Mr. Deputy Speaker. Could you ask the right hon. Gentleman to address you because it is difficult to hear what he is saying.

Mr. Deputy Speaker (Miss Harvie Anderson): I do not think the right hon. Gentleman means any discourtesy, but it is rather difficult to hear him.

Mr. Ross: It was not calculated. I am sure that the hon. Gentleman would be the last person to accuse me of that discourtesy. I have a high regard for him.


He was the only Member with the courage to support the Government over U.C.S. The rest of the troops fled the field—he was the only Scottish Tory who spoke.

Mr. MacArthur: Typical distortion.

Mr. Ross: The position of the Scottish economy is serious ; the army of the unemployed grows daily. I do not say that hon. Gentlemen opposite are inhuman ; they are simply blind to the hardships caused by certain decisions they take. There are many people in Scotland who have forgone their holiday this year. On Clydebank they went on holiday on 2nd July for three weeks ; the men in the Govan, Linthouse and Fairfield Yards will go on holiday at the end of this week. None of them knows what will happen after 4th August.
Will the right hon. Gentleman tell us whether he has so far had meetings with the Four Wise Men, and with the Liquidator? Can he cheer us up with a statement that the Government have changed their mind about the annihilation of U.C.S. and the selling-off of what they have, if necessary at a pittance, to quote a celebrated document? Can they tell us anything about the S.D.A. beyond what we already know?
The right hon. Gentleman knows that I have been seeking an interview with him about the position of Kilmarnock, Ayr and South Ayrshire. My hon. Friend the Member for South Ayreshire (Mr. Sillars) has been discussing this with me too. The people of Livingston are concerned about it, as are the people of Dundee and Glenrothes. If I were a member of the Highland Board, I would be concerned about it too. It has become nonsensical. [Interruption.] I am not against the special area development policy ; I am against unfair discrimination in areas worse off than those accorded special development area status.
Will the Under-Secretary tell me how the unemployment in Irvine compares with that in Kilmarnock, or that in Ayr with Paisley? I will tell him. It is very much worse in those areas left out of the special development area scheme. Administrations should be fair in giving help to areas but let us not delude ourselves that a special development area,

whether or not it covers the whole of Scotland, would be of any use unless the economy is right. This is what the Government have failed to do. They are getting plenty of advice from everyone about that. The hon. Gentleman should turn his mind to a general reflation in the country. In Scotland there should be massive reflation.
I am not talking about £8 million to be spent over two years an the maintenance of trunk, principal and unclassified roads. That is the sort of joy we got this morning in Committee upstairs from the right hon. Gentleman. And what does it mean? It is less than £4 million a year, and we spent more than that on winter works in 1968. That is all we were offered this morning by the right hon. Gentleman.
A considerable part of even that sum must be paid by local authorities, because the right hon. Gentleman said that 75 per cent. would be the grant for maintenance of principal roads, with a 50 per cent. grant for unclassified roads. I trust that the right hon. Gentleman recalls the cut made in the rate support grant for local authorities of £1 million this year and £2 million next year. What is the net benefit of all this to Scotland? Will it cure unemployment? Of course not, and I hope that the right hon. Gentleman will not rest on this ludicrous position.
We require a massive improvement, and the Government must consider pouring orders into these areas, particularly in relation to the nationalised industries. We did this when we were in power through the Post Office and the steel industry. Only by this means can we ensure that the jobs in the factories that supply the national industries are boosted.
The Government must turn their mind away from what they have done in respect of, for example, investment grants. Lord Clydesmuir recently gave the Government some good advice and his words are quoted in today's Guardian. He is the mildest of men, and when he gets angry with a Tory Government something must indeed be wrong. There is no indication that his words are being heeded.
The whole question of confidence is at issue. The people of Scotland have a Government for whom they did not and would not vote. Hon. Gentlemen opposite dislike the people of Scotland for


their political loyalty to the Labour Party. [Interruption.] The Times said this morning :
The position in Britain today may well be one where the forces of recession are so deeply entrenched that traditional reflationary measures on their own are powerless to remove them ".
We have reached the stage in Scotland when we have become so deeply embedded in unemployment that it will be difficult to get out of it. The Times went on to say that the Government's measures lacked
that economic catalyst blithely described as the confidence factor without which no sustainable economic growth is possible".
It added :
It is within the Chancellor's power to help fill up industry's order books by stimulating demand. His real problem is to convince industry that they will remain full in the lifetime of future fixed investments".
Confidence in this Government has gone. It is not a change of policy we need, but a change of Government.

4.54 p.m.

The Secretary of State for Scotland (Mr. Gordon Campbell): I beg to move, to leave out from "House" to the end of the Question and to add instead thereof :
'recognising the special problems that have arisen in Scotland and the regrettably high unemployment accompanying them, which has resulted from the inflationary policies pursued by the last Government, endorses the measures introduced by Her Majesty's Government, including the creation of a special development area covering West Central Scotland and other powerful incentives for regional development, as relevant and effective for dealing with this situation'.
The upward unemployment trend when we arrived in office last year was a depressing fact. In every month since October, 1969, unemployment had been higher than in the corresponding month of the previous year, and the gap was increasing all the time. That was the position from October, 1969. We could, therefore, see what the trend was before we came to office.
Even more depressing was the prospect that the raging inflation at that time would make it difficult to alleviate and put matters right. The high rates of unemployment in Scotland in recent months would not have happened if this inflation

had not been rife in 1970 and if there had been some reasonable growth in the economy. But because of rising costs, resulting mainly from unexpectedly high wage settlements, firms have felt impelled to reduce their labour forces and have been understandably cautious about launching into new investment and expansion.

Mr. Donald Stewart: How can the right hon. Gentleman maintain that inflationary wage settlements were the cause when he knows that average wages in Scotland have been lower than in England?

Mr. Campbell: I will come to that shortly.
During the past year the Government, for this and other reasons, have made it one of their main tasks to do all within their power to curb inflation and its effects on costs and prices by tackling this at its source—inflationary wage settlements. [Interruption] There are some welcome signs that we are succeeding, but the inflationary situation which we inherited cannot be put right overnight.

Mr. John Robertson: Fifteen months is a long night.

Mr. Campbell: As the House knows, I deplore the current high levels of unemployment in Scotland. They are painful in human terms and wasteful because our resources are not fully used. The Government are determined to put this right and the policies and measures which we have introduced, some of which are only now beginning to have effect, are designed to promote soundly based growth, with special emphasis on regional development.
Let us examine the situation in the middle of last year, when inflationary wage settlements were threatening to cripple trade and industry. [Interruption.] There had been a period of compulsory squeeze, which many hon. Gentlemen opposite, among others, opposed and criticised. When the freeze came to an end, the flood from the thaw was allowed to pour over the dam. The result at the end of the day was a situation which was worse than if there had been no freeze.
Moreover, the consequent rise in prices was inevitable, though naturally later in


its impact. This has nowhere been more neatly described than in these words :
The main fact is that we won the 1966 election by choosing the moment of wage inflation before the prices had really been felt to rise ; and obviously we were seeking to do it again in this election in 1970.
That was said in a radio broadcast on 15th April by the right hon. Member for Coventry, East (Mr. Crossman). There is no doubt that the decision to let wages rip in the first part of last year, and to let the inevitable later price rises look after themselves after the election, was a political decision which had most damaging effects on Scotland.

Mr. George Lawson: My hon. Friends and I do not base ourselves on the words of a journalist. Is the right hon. Gentleman aware that he has simply quoted the words of another journalist?

Mr. Campbell: He was a member of the Labour Cabinet. One is inclined to take account of the statements made, within a year of leaving office, by such a right hon. Gentleman.
Besides grappling with this inflationary situation, the new Conservative Government worked out, without delay, changes to improve the combination of regional development measures ; and on 3rd February I announced that the major part of West Central Scotland was to be designated a special development area, including nearly half the working population of Scotland. We have extended to the whole of the Edinburgh area the intermediate status, which the Labour Government had, on a highly arbitrary and unrealistic basis, given only to Leith. No part of Scotland is now without assistance for industrial development.
The new incentives for development areas include a system of free depreciation which can be carried forward to future years or back to previous years where profits are not made at the beginning ; increases in the rates of building grant ; greater use of the local employment Acts ; and continuance of the 40 per cent. initial allowance for new industrial buildings, which was due to have ended in 1972.
The new taxation allowance for service industries is especially helpful in Scotland, where service industries have, in recent years, felt acutely the discrimina

tion against them. Similarly, the halving of S.E.T. this month is likely to have a more favourable effect in Scotland than in any other part of the country.
For the new and very large special development area in West Central Scotland, there are additional incentives for new industry. There is the operational grant for eligible wage and salary costs for the first three years for incoming projects. This grant is being increased from 20 per cent. to 30 per cent. Also, rent-free factories can be made available for five years, instead of two years as in the development areas generally. The combination of incentives related directly to employment is more powerful than at any other time.
I know that some hon. Members opposite hanker for the old investment grants. But they have apparently forgotten that the Estimates Committee, containing a majority of Labour Members, called over two years ago for an investigation into the effectiveness of investment grants, and that the Labour Government of that day duly started such an investigation. The point I ask the House to consider is that, under the previous system, a huge investment grant could be given for a project which had the effect of reducing jobs. The grant was not related to employment and could have haphazard and anomalous effects of that kind.

Mr. Bruce Millan: Why do not the Government publish the results of the inquiry?

Mr. Campbell: The inquiry was started under the previous Government. What they did was their affair, but they announced to the House that they had started an inquiry. We came into office having already stated that we would make this change, because we had made our inquiry before we came into office.

Dr. J. Dickson Mabon: Let us get this absolutely clear. Such a study was commissioned, but it was not published although present Ministers, when they came into office, had this study, and they made this decision before they read the study. Is not that true?

Mr. Campbell: Naturally, in Opposition, we were not just sitting about waiting until we came into office to see the


results of the studies of right hon. and hon. Gentlemen opposite. We had been doing our own work and we stated beforehand that on the information and studies which we had made, we thought that the money for development areas could be used more effectively and tied to jobs by other methods. Having said that before we came to office, we went into it very quickly in our review and announced at the end of October new measures and changes which were in principle on the lines of what was the intention before we came into office.

Mr. William Hamilton: I was Chairman of the Estimates Committee which made that recommendation. It is true that no research had been done into the effects of investment grants. That recommendation was implemented by the Department which made the inquiry. We would like to know how far the Government's policy has been influenced by the recommendation made by that inquiry and whether the Minister will now publish the results of the inquiry.

Mr. Campbell: That is an interesting point which I will certainly look into. I have the report of the Estimates Committee. I found it most interesting reading on this point. I have taken my extract from it.

Mr. Hamilton: It is in the right hon. Gentleman's brief, that is all.

Mr. Campbell: Not at all. This is something on which I have been working for nearly two years. It has nothing to do with the brief. It is something that I have prepared entirely myself. I remember very well that the hon. Gentleman was Chairman of the Estimates Committee. We have discussed this matter before, across the Floor of the House. He and I are especially interested in this subject. I will follow up what he has asked, but I cannot spend the rest of my speech on that matter.
There are now powerful and attractive incentives for industry to develop in Scotland, but they will be fully effective only when there is more mobile industry looking for places in which to settle or expand. The incentives must be accompanied by investment confidence and growth. I agreed with the right hon. Gentleman when he said that. The

Government's economic policies as a whole are designed to achieve that situation.
During the past year there has been a limited amount of mobile industry in Britain. At the same time, employers, because of rising costs and falling profit margins, in many cases have been reducing the numbers employed on existing work. This shedding of labour and the lack of growth of the economy have together contributed to the present situation. Without a healthy and expanding national economy it is difficult for the regional economies to grow.
Besides the general measures which I have mentioned, we have taken a number of specific measures nationally to establish a sound framework for growth. We have made two successive cuts in corporation tax, amounting in all to 5 per cent.; after cutting S.E.T. by half, we shall abolish it altogether by 1973 ; and Bank Rate has been cut. All these measures constitute a strong stimulus to firms throughout the country. As business confidence returns, these measures will be seen to encourage and help to finance industrial expansion.

Mr. Tam Dalyell: Has the Scottish Office made any serious estimate of what has happened as a result of halving S.E.T.? Are there any figures for that?

Mr. Campbell: There are a number of factors. A very important factor is that the cost of an average house is likely to be reduced by £50. A number of other factors, for example, inflationary wage settlements, could have the opposite effect. But the cutting of S.E.T., we are told, is the equivalent of £50 off the average price of a house. [HON. MEMBERS : "Who told you?"]. The industry, as well as others.
One important way in which more growth in our economy can be achieved is by the dynamic effect of entry into the European Economic Community. This is one of the main reasons why the Government are seeking access to that huge market. This can be of immense significance to Scotland in promoting—

Mr. Alex Eadie: Mr. Alex Eadie (Midlothian) rose—

Mr. Campbell: If the hon. Member will forgive me, I have given way a lot.


I will give way to him after I have dealt with the passage about the E.E.C.
This can be of immense significance to Scotland in promoting the additional investment we need and in producing more mobile industry looking for areas in which to expand. The removal of tariff barriers between the United Kingdom and the Common Market countries would create more favourable conditions for overseas countries to invest in Scotland.
With the support of industry in Scotland, and through the agency of the Scottish Council, a considerable effort is being made, with Government help, to concentrate and co-ordinate Scottish promotional work abroad. Over recent years one thing has become quite clear and it is more apparent than ever now. That is that many foreign companies, especially American companies are interested in settling in Scotland if we are to be part of the Common Market. But if we do not join, they may decide to settle on the other side of the North Sea in order to be inside that vast consumer market. The stimulus to the British economy as a whole which is likely to accompany membership of the E.E.C. could be of great benefit to Scotland.
Our regional development measures for attracting new investment to Scotland are in full accord with one of the major objectives of the E.E.C. as stated in the Preamble to its Treaty, namely, to ensure harmonious economic development within member States by reducing the existing disparities between the various regions of those States.
Moreover, regional policies of the kind which we have for Scotland are being pursued by present members of the E.E.C.—for example, Italy and France. I have myself made a tour of the new steel works at Taranto in the south of Italy ; and further steel works development is now being carried out in that region.
When considering in the coming weeks the momentous decision to be taken by Britain we should have in mind that the effect of the industrial dynamic is likely to be beneficial to Scotland as it will be to other parts of the country. It is not surprising that the Scottish Council—the right hon. Gentleman was quoting Lord Clydesmuir a good deal earlier this afternoon—supports British entry. So did the

Study Group which was set up by the Scottish C.B.I.
Indeed, the right hon. Member for Kilmarnock (Mr. Ross) himself, when he was Secretary of State two years ago, seemed to be of the same view. In a Written Answer he made this statement :

"A detailed analysis of the consequences of membership for particular parts of Great Britain is not practicable but the Government are confident that in the long run membership will be of economic advantage to all parts of the United Kingdom."—[OFFICIAL REPORT, 16th July, 1969; Vol. 787, c. 113.]

Mr. Eadie: Was the right hon. Gentleman in the House earlier this afternoon when the Prime Minister confessed that no regional policies had as yet been worked out by the E.E.C.? Therefore, does he not agree that this has flung open to a considerable extent the question of regional policies inasmuch as, if we pay too high a price to enter, the Government, in allocating financial resources, will not be able to pursue financial policies in the way that the right hon. Gentleman is suggesting to the House?

Mr. Campbell: I was here earlier and heard that exchange. I was referring to what members of the Community are doing now individually. The fact that they have not finalised their own regional policies as a group together means that we as members can take part in the discussion on and eventual formulation of those policies. I only wish that they had left their fishing policies to be dealt with after our entry, because life would have been made a little easier for us if those policies had been left open until we and others were members and could have done something about them.

Mr. James Hamilton: The Secretary of State referred to the Scottish Development Council and the C.B.I. Will he tell us now whether both of those bodies are in tune with the Government's policy as regards the departure from investment grants and the move towards free depreciation?

Mr. Campbell: As I have said before, different industries have different views. There are some industries that have preferred the investment grant system. Obviously capital-intensive industries in some cases benefit from them. Other industries prefer the new system. I have


taken account of the different views, but I am not aware of a particular view being stated by either of these bodies as a whole to me. These bodies have been concerned with the major questions of unemployment, what can be done to improve investment confidence, and the measures to be taken to use fully the resources of Scotland.
I turn now to the question of Upper Clyde Shipbuilders which the right hon. Gentleman mentioned.

Mr. Robert Maclennan: Mr. Robert Maclennan (Caithness and Sutherland) rose—

Mr. Campbell: I have given way a great deal and I must move on, otherwise I shall take up too much time. [HON. MEMBERS : "Give way."] If the hon. Gentleman wants to talk about the Common Market before I leave that subject, I will give way.

Mr. Maclennan: The right hon. Gentleman said in his remarks on the subject of the Common Market, quoting my right hon. Friend the Member for Kilmarnock (Mr. Ross), that it was expected that in the long term it would be for the benefit of Scotland. Many people would not dissent from that. What we are concerned about is the short term. Has the right hon. Gentleman noticed today that the investment intentions of industry show the most depressing downturn and the level of production is falling? Is the right hon. Gentleman making the strongest representations to the Chancellor to reflate quickly, because, if he does not, Scotland will not be in a healthy state to withstand any further strains?

Mr. Campbell: As regards the short term, I believe that if Britain decides to enter the Common Market, and when this becomes clear, this in itself will start the confidence in investment which we look to, because firms which are now waiting to see which way we are to go will start making their plans. So I think that there are good short-term prospects in this. The measures which we have taken already since we have been in government are intended to and are now beginning to have their effect in creating—

Mr. Lawson: They are not.

Mr. Campbell: As I explained, it takes time for all measures to come into effect. For example, some of the Budget measures are starting to have effect only this month. Therefore, unfortunately, there is a time lag before such measures can become effective.
I must turn now to the question of U.C.S., which the right hon. Gentleman mentioned, because the right hon. Gentleman has again made the ludicrous proposition that U.C.S. has gone into liquidation as a result of a deliberate Government plan over several months. The right hon. Gentleman is talking utter nonsense. I want to make that quite clear. I am glad to note that the Press realise now that the suggestion is ludicrous.
That U.C.S. should have gone into liquidation now could only add to the troubles and burdens of the Government. It is the last thing that we could have wished. It is happening in an area which has special problems, as we have recognised by designating it as a special development area.
Since U.C.S. was brought into existence by the right hon. Member for Bristol, South-East (Mr. Benn), whom I am glad to see here, when he was Minister of Technology, it has been in difficulties. It has had a succession of crises when it has come to the Government for financial help. Between November and February last such a crisis occurred, but it did not receive publicity, and publicity would not have helped U.C.S. The Government were able to assist U.C.S. at that time with the detachment of Yarrow's and by agreeing to a substantial writing down of its capital.

Mr. Dick Douglas: Never completed.

Mr. Campbell: It was agreed at that time. U.C.S. then said that it was out of the wood and could see a viable future.
I have with me the U.C.S. magazine of March of this year. It carries optimistic comments such as those we were also reading in the Press in March and April. I was glad that all seemed to be well again. There was in that magazine the following passage written by its managing director :
The last Government made it quite clear that we could expect no further aid, and the present Government have made it equally clear.


We must stand on our own feet, and through our own efforts go forward.
That was last March.
Later, when he was asked in a television interview what had gone wrong, the managing director said this :
I think it is inherent from the formation of the group. The group was formed really with insufficient working capital.
When the last crisis blew up so quickly early last month, it was clearly a shock to the board of U.C.S. themselves. As I stated in the debate on 15th June, it was the result of an urgent financial review which they had arranged. The board clearly did not themselves know their true financial position until they received the report of their special review on 7th June.
It has been suggested that the Government should have known, even if U.C.S. did not, because of the S.I.B. director on the board. Let me here quote from the evidence given by the right hon. Member for Bristol, South-East before the Select Committee on Scottish Affairs on 24th June, 1969. The right hon. Gentleman was dealing with the question of communication between U.C.S. and the Government. He said this :

"In the case of Mr. McKenzie, he has been the S.I.B. director dealing with the S.I.B. But it has never been our objective that we should deal with the company through the government directors. The government directors are directors of the company. They have special responsibilities which are understood. But I think it would completely undermine the authority of the Chairman if he felt that one member of his Board was dealing with the Government or with the S.I.B. without his being consulted. Therefore, we have always dealt, in so far as it was necessary to do so, directly with the Chairman."

Mr. Anthony Wedgwood Benn: The right hon. Gentleman quotes from an answer which I gave to the Committee in response to a question about whether I dealt with the company through the Government director. I gave the absolutely correct answer, and that is what he read. What the right hon. Gentleman has not dealt with in that connection is whether it is the duty of the Government director to inform the Government of circumstances which arise. Of course, Mr. Mckenzie so informed me at earlier stages. It is inconceivable that the Government did not know what was happening, and they were, in fact, following a plan worked out by the hon.

Member for Cirencester and Tewkesbury (Mr. Ridley) in December, 1969.

Mr. Campbell: I was quoting the right hon. Gentleman simply to show that he had stated to the Select Committee the normal means of communication, which were the normal means of communication also for this Government—Minister to chairman and board. I agree, also, that there was nothing to prevent the S.I.B. director expressing his personal view if he had to. But what I am pointing out is that it was perfectly clear that the board of U.C.S. itself was not aware of its financial position. It instituted the financial review, at the instigation of the S.I.B. director, and it was not until the result of that was produced that it suddenly realised what the company's position was. I think that the board was making its optimistic remarks in all good faith in March, April and May. I believe that it really thought that it was out of the wood, until it suddenly had the further review and found that the company was in deeper trouble than before.

Mr. Douglas: I realise that there have been a number of interruptions, but there is an important point to be made here. The essence of the association between the S.I.B. director and the Government has not fully been unfolded, because the initial impetus to go into liquidation goes back to October, 1970, when the S.I.B. director communicated directly with the Department and gave a very pessimistic impression to the Department of the company's future. In so far as that led the present Government to withhold the underwriting of credit, that precipitated the crisis. The Government are responsible for directly communicating with the S.I.B. director and, indeed, for overruling and over-riding the views of the S.I.B. on credits at that time.

Mr. Campbell: The S.I.B. director was then doing exactly what the right hon. Member for Bristol, South-East (Mr. Benn) said he was free to do, and the crisis which I have just described was overcome. The Government were able to help by the detachment of Yarrow and by the substantial writing down of capital. Upper Clyde Shipbuilders was itself quite satisfied that it was out of the crisis and out of the wood ; it thought that it was in a better position than ever.


I am glad to correct that misapprehension, and I must now get on.
In the same proceedings of the Select Committee, on the question of the future possible liquidation of U.C.S., the right hon. Member for Bristol, South-East said, on 24th June. 1969 :
… we have never taken the view—it would be quite wrong to take the view—that at whatever price U.C.S. or any other company in the shipbuilding industry would be kept alive ".
I quote that because it is on the record, it is quite understandable, and the Select Committee heard the right hon. Gentleman say it. In the light of what he has done and said two years later, I think it right that the right hon. Gentleman should recall what he said at that time.

Mr. Benn: The right hon. Gentleman quite properly quotes what I said, that at no stage were we prepared to support any company regardless of its prospects of viability. The criticism which he has to face is that at higher cost than the cost of support he is letting U.C.S. go into liquidation. He is paying a higher price for it than giving the company the resources to allow it to move into viability. That is the charge which he must face, and he has made no attempt to answer it.

Mr. Campbell: That is the point to which I am now coming, and I am obliged to the right hon. Gentleman for raising it. I must make clear again that, last month, it was not just a loan of £6 million which was needed. The board of U.C.S. said that it hoped that the company could become solvent again if the Government were prepared to provide £5 million to £6 million as grant or equity, not as loan, and if its creditors would accept 33p in the £, which would have meant a further £5 million or so to it. But even then there was, unfortunately, no clear prospect of when the company could become solvent again, if at all. A great deal more than £6 million was involved.
I have said that before, but there was so much noise in the Chamber at the time that, unless hon. Members looked at HANSARD the next day—and some of it may have been missed—they might not have had the point clear, and I am glad to make it absolutely clear now. It was not just a matter of £6 million.

Mr. Benn: How does the right hon. Gentleman define solvency? The definition given by the Secretary of State for Trade and Industry was not one which has ever been applied in business in any similar circumstances.

Mr. Campbell: I think that the chairman of U.C.S. and my right hon. Friend were themselves in doubt about what they were meaning by that. But I cannot pursue the details of it now. I think that the right hon. Gentleman has got my point. The £6 million has been bandied about as though that was all that was required. Unfortunately, it was a great deal more than that.
The Government are determined to bring about a successful reconstruction on the Upper Clyde. They are providing funds now to cover pay, including holiday pay. I am myself meeting the group of advisers for discussions later this week. Last week, I had the benefit of discussions with the provisional liquidator, Mr. Robert Courtney Smith, who, I believe, has the confidence of everyone concerned. It is important now to concentrate on the future.
I turn now to Hunterston, and the question raised by the right hon. Member for Kilmarnock, to draw attention again to its importance for the development of the West of Scotland. It is true, as he said, that, over two years ago, on 7th July, 1969, I initiated a debate in the House in Supply time on the importance of the Firth of Clyde and the unique facility of deep-water sheltered berths there. My hon. Friends and I drew attention to these and other assets, and their particular importance for the steel industry, besides providing a basis for a new industrial complex in Ayrshire.
I supported the interim report of the group working on Oceanspan during that debate, before the Oceanspan Report itself had come out. Sir William Lithgow and Professor Nicoll were working on the matter but had not yet produced a report, but they put out an interim report which received my full support. Soon after I came into office, I was presented with the report of a public planning inquiry. My main decisions were affirmative, not negative. I lost no time in taking the planning decisions to allow a deep-water port and an ore terminal and, by zoning the land for industry, to leave the way open


for a modern integrated steel works in due course.
These decisions were announced last December, and thus the potential and availability were proclaimed in due time. The bodies and the corporations concerned are now working out the proposals.
We should not overlook, either, the way in which defence establishments can use our resources in Scotland. Besides contributing towards our country's defence, these establishments provide a considerable number of jobs of different kinds. The rocket range in the Hebrides and other establishments, such as the Faslane base, have shown that these establishments can usefully contribute to our Scottish economy.
I have some experience of this myself as there are two Service airfields in my own constituency which play an important part there. Although one of them has had what were at the time the noisiest, indeed, the most deafening aircraft in the world, my constituents were wise enough not to object, since they knew what was good for the area's economy. The complaints have come only recently and stem from anxiety that one of the stations may be somewhat reduced.

Mr. John Brewis: My right hon. Friend will be aware that in my constituency we have considerable experience of defence establishments extending over about 30 years, and he will know that some establishments are much worse than others.

Mr. Campbell: I am aware of that, but I think that right hon. and hon. Members on boh sides recognise that there is practically no establishment, industrial or defence, which does not, when it arrives, cause damage to someone, whether through smell, noise or visual effect. Unfortunately, there are such disadvantages. What we must do is try to steer what will be helpful and useful developments to the most appropriate places and the places where they are needed.
I believe that all informed observers of the siutation which I have described agree that, besides economic measures, including regional development incentives, a public works programme could make a significant contribution towards alleviating unemployment in the coming months. The Government have been con-

sidering this, and we have been able to identify such work, over a variety of fields, which can usefully be undertaken.
I can now announce a major new programme in this field, which can be divided into two schemes, to increase expenditure on public works in Scotland up to March, 1973. The first is the one about which I informed the Scottish Grand Committee this morning. I propose to authorise a special roads scheme for Scotland amounting to £8 million in the current financial year and the next. It will consist of £2 million of additional expenditure on trunk roads and £6 million on other roads, towards which special grants will be available in Scotland only.
Second, there are works which can be carried out wihout any special grant arrangements. My Departments will consider with the local authorities and other bodies directly responsible further work of a capital nature, beyond what is already programmed, which they could undertake and substantially complete by March, 1973. This could include work on schools and other educational buildings, on hospitals, in agriculture and fisheries, and for social work, police, fire, environmental and other local authority services. I have provisionally estimated that all the possibilities from the two schemes could between them yield a total of about £33 million of additional work.
I intend to stimulate the maximum possible amount of work to be done in the remainder of the current financial year, so consultations will be pressed ahead with all possible speed. We hope to get some work approved and started even before those consultations are finished. For example, in education we can give immediate approval to a substantial number of improvement and replacement projects which could not be accommodated within normal programmes.

Mr. Galbraith: I am very interested in my right hon. Friend's helpful announcement, but he left out a very important aspect. Since industry pollutes, could not the grants be given particularly for anti-pollution work, and thus give us the best of both worlds?

Mr. Campbell: I will certainly bear my hon. Friend's point in mind in the consultations.
In addition, where we can provide a direct stimulus to the Scottish economy


we have not hesitated to do so. The special house improvement grants for the next few years, proposed in legislation now before the House, are intended to encourage more work of a kind which, in addition to its value in providing better housing conditions, will provide work quickly for the construction industry.
We have been looking very carefully at housing finance. The Government's housing policies were fully discussed in the Scottish Grand Committee recently. Our proposals for housing finance for Scotland will be set out in a White Paper to be published tomorrow. The reforms proposed are somewhat different from those proposed for England and Wales in the White Paper published today. The Scottish White Paper will end some unavoidable uncertainty, and provide for progress in housing in both the private and the public sector.

Dr. Dickson Mabon: The right hon. Gentleman has referred to house improvement grants. Let us get the figure of £33 million clear—the £8 million on roads and the other £25 million. Does it include the house improvement grants scheme? Is it entirely additional to programmes already announced?

Mr. Campbell: It is entirely additional to the programme I have announced, to the special grants included in the Bill which is being discussed on the Floor of the House.

Dr. Mabon: Do I take it that £8 million is on roads, and is divided into two sections, part of which is financed by the local authorities, and that £25 million goes to local authorities? May we have more detail on how that will be allocated between central and local government expenditure?

Mr. Campbell: I cannot give further details now. We are going into consultions with the local authorities on how it can be used, and we will provide the House with the information at the earliest opportunity. I wanted today to announce the broad lines of the programme.
We have also recently made arrangements to assist Glasgow to tackle some very real problems. These will produce further work for the construction industry. First, we are proceeding to

establish a new community at Stonehouse in Lanarkshire, with an initial target of about 10,000 houses. Second, the Scottish Special Housing Association is to undertake the construction of about 7,000 additional houses for families coming out of Glasgow. Third, up to £1 million a year will be provided for five years to assist the Glasgow Corporation to improve the general environment.
In economic matters there is always a considerable time gap between the introduction of measures and their showing results. But there are some encouraging signs. Industrial development certificate approvals, both for the West Central Scotland S.D.A. and for Scotland as a whole, have turned upwards in the first six months of this year. Though this is too short a period for any firm judgment to be made, this is encouraging after the downward trend in recent years.
Another very significant and encouraging factor is that there are indications that the discovery of oil in the North Sea off the Scottish coast will prove a commercial proposition.

Mr. Ross: Could the right hon. Gentleman give us the figures for the I.D.C.s?

Mr. Campbell: My right hon. Friend the Minister for Trade will provide figures later when he winds up the debate. I said that there were encouraging signs, and in a speech that is already too long, I am giving general indications. The particular points raised will be dealt with later.
If B.P.'s tentative plans for bringing oil ashore from its Forties field materialise, Scotland could benefit considerably. If the flow of oil is up to expectations, it could provide a secure base for the planned expansion of the Grangemouth refinery to 18 million tons a year, making it one of the largest in Europe.
Already there are signs that the exploration activity off the North-East coast is generating activity in that area of Scotland, where shore installations, pipeline construction, servicing facilities, housing and other provision for oil industry personel would be required. The North-East Scotland Development Authority has shown admirable initiative in bringing together the oil companies and the local interests concerned at an early stage.
It is also encouraging to note that Scottish capital is beginning to participate in the groups applying for licences. The recent Government announcement inviting applications for licences for the exploration of large new areas included for the first time 16 blocks in very promising areas, including Scottish waters, for which competitive tenders are invited. This is expected to stimulate exploration activities still further. My Department will be actively engaged in support of these promising developments.
I have made it clear that we have been facing a difficult situation in Scotland. In the relatively short time we have been in office, we have taken a number of major steps to put the situation right, both centrally and regionally. My announcement today of a large new public works programme is another measure to help, and is designed for the immediate future. But putting the situation right will take time. It is essential to discern the opportunities available in Scotland and for Scotland, as well as the special problems which we face. It is our firm purpose as a Government to see Scotland clearly in her traditional place among the leading industrial nations.

Several Hon. Members: Several Hon. Members rose—

Mr. Speaker: Order. The debate began at seven minutes past four. We have had two speeches in about an hour and a half. I am stating a fact and not making a complaint. Over 20 hon. Members wish to speak and we have about 3½ hours before the Front Benches will want to intervene again.

5.39 p.m.

Mrs. Judith Hart: The first thing to be said in commenting on the Secretary of State's speech is that he seems to under-estimate the degree to which he is in considerable political trouble. I have never heard a more complacent speech in a situation like the present from the Government benches. We see that the right hon. Gentleman is in the more serious trouble when we look back at his predecessors. I recall the period during the 1950s and early 1960s when his predecessors, including the present Minister for Trade, were in office, and the worst unemployment situation that arose during that time, when in the middle of a rather difficult winter

Scotland had a figure of unemployed which reached the 120,000 mark. We remember the tremendous distress which even the Government of that time were feeling and which they talked about.
The right hon. Gentleman may refer in the Amendment to "regrettably high unemployment", but we have heard hardly a word of regret from him today. On the contrary, we have heard a good deal of complacency and the kind of promises that we cannot take seriously any more in the light of a year's experience of this Government. We have heard little of any real sense of regret or of any real sense of the urgency which has arisen in the Scottish economic situation in the 13 months that he has been Secretary of State.
The period of the 1959–64 Conservative Government was bad enough for Scotland—a time of Conservative fuel policy and pit closures, of Conservative transport policy and Beeching rail closures—but it was a time of Conservative innocence compared with what has been deliberately inflicted on the Scottish economy in the past year. We are all fully aware of the figures. The right hon. Gentleman, the Government and the people of Scotland are facing the present level of unemployment against the prospect of much more to come and of unknown risks to come which we cannot calculate. Rolls-Royce and U.C.S. are still at risk. More redundancies have been announced and more are in the pipeline every week. Soon the school leavers will be added to the ranks of the unemployed. And there is next winter to come.
In his Amendment and in his speech today, the right hon. Gentleman not only admits but takes some pride in recognising that the "regrettable unemployment" is a direct consequence of the Government's deflationary policies. That is the factor which we have never heard coming from a Conservative Government before. They admit that it is not just their failure to take necessary action but a deliberate act of policy to create deflation, whatever its effect upon those parts of Britain which urgently need more employment rather than a taste of Tory deflation. He regrets the consequences, but what we want to know—and he has not told us—is what kind of an argument he is putting up in the Cabinet. Is he


arguing for or against deflationary policies? Is he arguing that reflation is overdue? I suspect, from what he said today, which went a little beyond the natural Cabinet loyalty of a Secretary of State for Scotland towards his economic colleagues in the Cabinet, that he is one of the firm believers that deflation has not gone far enough, that he is not arguing inside the Cabinet for the economic policies which are essential if we are to have any kind of upturn in employment in Scotland.
The right hon. Gentleman seems to be limiting himself to fighting for his programme of public works. Of course, it is splendid to hear that at least he is converted to Keynesianism, even if he is not converted yet to anything which takes us beyond that point. He is at least ready to admit that there can be Government intervention, even if it is only in the Keynesian sense of putting men to work on roads and building. He suggested that this programme will be a massive contribution to resolving the Scottish problem of unemployment this winter.
He should remember, however, that in a public works or building programme two kinds of people are required. First, highly skilled building workers are needed. That will be a good thing for the building industry and to the extent that there are skilled building workers out of work, this will be good enough. Secondly, large numbers of unskilled workers are unemployed, and they are needed in such a programme. But a high proportion of highly skilled craftsmen from other industries are unemployed and the right hon. Gentleman's public works programme can offer little to them. The latest figures from the area of my constituency—Lanark—show that 47 per cent. of the unemployed in the Lanark employment exchange area are in the skilled category, and public works programmes are not the kind of thing which they are either anxious to take or which they should be offered by a responsible Government seeking to use in the community the resources of skill which they possess.
The trouble with the right hon. Gentleman and his Cabinet colleagues is that they are prisoners of their own political philosophy in this matter. In their elec-

tion manifesto, on the general principle governing these matters, the Conservatives said that they rejected the detailed interventionism of Socialism. But what Scotland is proving goes beyond this, with 121,000 unemployed and the prospects of having more next winter, and goes beyond even the fact that, in the last year or two of the Labour Government, we did not reduce unemployment as much as we would have liked. What is being proved is the total failure of a free market economy to exploit resources and provide full employment, even assisted by the financial incentives of regional policies—certainly those of the present Government.
The right hon. Gentleman implied—and, indeed, said when he offered us his remarks about entry into the E.E.C.—that growth is an essential precondition of economic health in Scotland. Of course that is so. But I question his assumption that entry is a recipe for that kind of economic growth. We can more properly debate this matter next week, but the belief is growing that the possible cost to our balance of payments will be so great that entry into the E.E.C. will be a recipe for minus growth rather than higher growth. But that is a matter on which there are differing opinions. The essential difference between the rate of growth of the last two or three years of the Labour Government, which was not as high as anyone would have liked to see, and the rate of growth today, which is even lower and may this year even be minus growth, judging by investment trends, is that we were establishing a sound balance of payments surplus as a basis for growth. The present Government inherited that sound basis and they have no excuse for lack of growth. Nevertheless, they make the excuse that they have to keep wages down.
When the right hon. Gentleman talks about the inflationary process of a year ago, what he is saying is that the Government decided on low growth, even if it means stagnation and minus growth, in order to keep the standard of living of the working people lower, because to do otherwise would be incompatible with their other economic and social objectives. Scotland is suffering from deliberate deflation caused by a political philosophy which takes that point of view.
It is no good the Secretary of State talking about "special measures" and "creating a sound framework for dynamic growth" if he is not prepared to pursue the kind of policies which are the only answer in this situation. The first essential for Scotland, therefore, is a programme of reflation, with the recognition that, in order to prevent the spiral of wages and prices, a prices and incomes policy is necessary. If that is to be achieved, it can be done only on the basis of a contract with the trade unions, and that will be achieved only on the basis of their understanding that the Government, pursuing a prices and incomes policy, are also pursuing social objectives that they wish to see accomplished. I do not think that the Conservative Government—and this is their dilemma—can ever enter into that kind of social contract with the unions.
Within the context of growth, there are special regional factors required which need to go far beyond anything which we have developed over the last 10 or 20 years. We need the right kind of incentives. I endorse everything that my right hon. Friend the Member for Kilmarnock (Mr. Ross) said about the desirability of investment grants rather than allowances and about the regional employment premium. We need the right kind of financial incentives, and very tough and effective industrial development certificate control. One question which the Government will have to answer in next week's debate is how they can reconcile a tough I.D.C. policy, which is a pre-condition of regional development, with the free flow of capital involved in the Treaty of Rome if we go into the Common Market. Much more stress should be laid on preferential lending rates and preferential bank rates. We have had those from time to time in the Scottish economy. They can be one of the most effective measures in providing finance for industrial development within Scotland.
We also need new emphases in public ownership, and again they go in exactly the reverse direction to that which the Government are likely to pursue. Far from hiving off and preventing the diversification of nationalised industies, we need a deliberate policy of not only encouraging but directing them to diversify into the regions where employment

is needed. This is the one sector where Government intervention can be guaranteed to work because the Government control the financial and marketing forces involved. I fear that the Conservative Government will never be able to find the right answer within their philosophy. For example, I should like the National Coal Board in Scotland to go into system building. This matter was under discussion when I was in the Scottish Office. This would be perfectly logical. We could have done with a sound, Scottish-based system building firm in Scotland. The Coal Board could have filled this rôle. I should like new public enterprises to be created—and this has been mooted in a number of Labour Party policy statements—in other directions as well as by diversifying the nationalised industries. All of these developments are possible only within a framework of growth.
I should have liked to make a number of constituency points. I will merely mention that, as the Secretary of State knows, I have been having discussions with the Secretary of State for Trade and Industry about the exclusion of Lanark from the special development area policy. I still have hopes that we shall reach a satisfactory conclusion on that matter, so I will not burden the House with it.
The Secretary of State for Scotland does not seem to realise the degree of his own political difficulty. He does not seem to understand that he is creating for himself the reputation of a Secretary of State who has done more damage to Scotland than any other since the war. The right answers are so diametrically opposed to the policies which he and his colleagues are pursuing that the question is not how long must we bear the burden of increasing unemployment in Scotland but how long must we bear the burden of the Secretary of State and his colleagues?

5.55 p.m.

Mr. Michael Clark Hutchison: There is no doubt that at present and for some years past unemployment in Scotland has been greater than it should have been and that prosperity has not been all that it should have been. Since I have been a Member of the House, Governments have attempted various remedies, but they have never had final and lasting success.
I find it difficult to pinpoint what is wrong and why we should not and have not done better over the years. I do not think it is anything to do with the national character. We are an able people with plenty of skills. I do not think it is anything to do with the political set-up or political beliefs. It is nothing to do with being workshy. If anything, the Scots are more hardworking than most people in the world. I do not think the education system can be blamed. We do not lack basic self-confidence.
Fortunately, many areas are reasonably prosperous and many firms are doing quite well, particularly those dealing with finance and insurance and the banks ; they should not be overlooked. I am inclined to think that the root cause in some industries and firms has been bad management. The story of Upper Clyde Shipbuilders is very sad, and there have been faults on both sides. I do not think that the management can be entirely acquitted. However, this does not provide us with an answer or with a line of action for the future.
I have not had a great deal to do with Scottish industry over the years as my work before I became a Member lay elsewhere. But not long ago—and here I must declare my interest—I became an outside director of General Time Ltd., the makers of Westclox and other brands of clock, whose factory is in Dumbarton. The factory is a subsidiary of an American organisation, but we work entirely on our own and employ 900 people, half of whom are women. The executive management is first class and the workpeople are excellent. We export on a considerable scale to South Africa, Australia and elsewhere. The Americans have such confidence in this company that they have given up operating the sales to Europe, including the Common Market, and given the responsibility to us in Scotland. The firm is expanding.
I do not know what lessons can be drawn from that. It has nothing to do with me because I have been with the company for only a short time. But if this organisation can do the job, why cannot others? Incidentally, the Americans decided that we should sell to Europe long before any decision on the Common Market was made. We are not interested

in the Common Market. We can beat the Common Market countries, whatever they do.
If I were asked why this company was in a reasonably happy position, I should say that it was because people have confidence in its management. If the workpeople have complaints or grouses, they know that they will get a square deal. The technical management is highly intelligent, and great care is taken to tell all employees exactly why things happen and what is proposed. People like to know what is going on in an organisation, and I think that in that respect relations are often very poor.
I am sure that there are many companies in Scotland which are equally good or perhaps better than the company to which I have referred. I hope that managements will always try to be imaginative and efficient.

Mr. James Hamilton: This is an important point which I have made several times. Does the hon. Gentleman agree that, where there are good industrial relations, there are good communications from boardroom level to shop floor level? Does he further agree that the Industrial Relations Bill could prove to be a handicap to companies of that kind?

Mr. Clark Hutchison: I do not know enough about the Industrial Relations Bill to know all its provisions or how it will work. I know only that in the company in which I am interested we have good relations from the board to the lowest rung on the ladder.
I commend my right hon. Friend the Secretary of State for the measures he has taken for the well-being of our country. He has not been sparing in his hard work and devotion to this job. Throughout the years we have been playing about with all sorts of remedies and devices to improve the position of Scotland. We have had depreciation allowances, Local Employment Acts, development area status, and so on. Attempts have been made to meet the difficulties and to recognise our geographical position and our distance from large markets. But I often wonder whether we should not scrap the whole lot and go over to an entirely new system of tax differentials.
For a long time I have believed that if Scotland had a lower rate of income


tax and company tax than the rest of the Kingdom she would prosper. This would not be difficult to administer. I know the Treasury would bristle at the idea, but surely the Treasury can be overruled. I have in mind that people who are genuinely resident in Scotland for the major part of the year, and companies which produce 80 per cent. of their production in Scotland, should pay a lower rate of tax. I commend this system, which would give a tremendous boost to Scotland, would be easy to operate and would be easy to defend.
I suspect that my right hon. Friend the Member for Argyll (Mr. Noble) is not averse to this idea, but whether my right hon. Friend the Secretary of State will be able to carry the day, I do not know. I may be told that this system would not be possible if we went into the E.E.C.

Mr. James Hamilton: Hear, hear.

Mr. Clark Hutchison: My reply to that is that I do not want to go into the E.E.C. Such action in my view would be detrimental to industry in Scotland and to agriculture and fisheries. In any event, I much prefer that we should wrestle with our own problems in our own way and have them under our own control. Entering the Market would take away our freedom of manoeuvre and power of decision, and so from Scotland's angle, quite apart from the United Kingdom's angle, I would oppose it.
I have endeavoured briefly to put forward some ideas which I hope my right hon. Friend will look at seriously.

6.4 p.m.

Mr. Ian Campbell: I perhaps go with the hon. Member for Edinburgh, South (Mr. Clark Hutchison) on the Common Market, and I entirely endorse the remarks he has directed to the Westclox factory which is in my constituency. I know of the excellent relationship that exists. The factory has a 100 per cent. union shop, and this is perhaps relevant to the intervention of my hon. Friend the Member for Bothwell (Mr. James Hamilton).
I should like to speak about the closure of the Plessey factory in Alexandria. The hon. Member for Edinburgh, South was speaking about the good industrial relations in the Westclox factory, but just

across the way in the Plessey factory the shop stewards were called together two hours before they went on their summer holidays and told that the place would close at the end of August. This is not the best way to conduct industrial relations. I want to speak of Plessey not because of the high unemployment—rising to one in eight males unemployed—which will increase because of the closure, but because people of all shades of political and industrial opinion are worried about the way in which the Plessey closure came about.
Six months ago the factory was a Government factory. My right hon. Friend the Member for Kilmarnock (Mr. Ross) explained the trouble to which the Labour Government went when he was in office to try to get new work into this Royal Naval torpedo factory. It is looked upon locally as a public scandal that a firm which was given many incentives to come into the area should, within six months, disappear. We know that the Government's policy is non-interference in industry, but during the last year there has been interference with Rolls-Royce, which was said to be because of defence. Not long ago there was the hiving-off of Yarrow from U.C.S.—this, again, is the defence section of U.C.S. Had it not been for the reaction of the work people, public opinion and Parliament to the announcement of the liquidation of U.C.S., the Government would not have stepped in so quickly to do something about it.
Plessey was born of Government involvement, but the previous Government's baby is being treated by this Government very much like a step-bairn. I will briefly run over the history of the firm and how the tax-over came about. About 20 months ago the R.N.T.F. was being set up to produce an under-water missile. A large new clean area had been established in the factory—one of the finest in the country—and new machine tools had been ordered. Unfortunately, there were some bugs in the design of the torpedo which could not be ironed out, so work had to be stopped. The Government found the firm Plessey, which was prepared to take over this large factory. It fitted the specification of a growth-type firm, able to take over the machining side, use existing labour in the large machine shops within the factory. It set up a numerical control section, which


was taken over from Ferranti of Dalkeith, together with many of the Dalkeith technical people. Now we see what has happened to this Scottish product in a new growth industry.
An interesting point about the start of the operation in Alexandria was that the Plessey operation was going on hand-in-hand with the run-down of the torpedo work. The torpedo work came under the restrictions of the Official Secrets Act, but the factory was divided into units with different firms working within the same building.
On 20th July, 1970 the Under-Secretary of State for Trade and Industry, in reply to a Question I asked about Plessey and the employment situation, said that the firm intended by the end of 1970 to employ 500 people and at the end of 1971 to employ 1,000 people. The company advertised locally for labour and said that its ultimate aim was to have 2,000 to 3,000 people employed. It will be realised what a blow it has been to the area that this factory is to be closed.
The company's Press release on the closure mentioned three significant facts. First, it said :
This reduction in demand—which has occurred rapidly since the end of 1970—is due to the effects on industrial investment of cost inflation and the general economy, both in the United Kingdom and internationally.
We on this side of the House feel that one of the reasons for the fall-off in the machine tool industry has been the change in Government policy and investment grants. Anybody with any connections with industry will realise that this is very much the case. Because of this change in Government policy, people are not buying equipment.
The Press release also stated :
… Plessey has reluctantly decided that it is no longer possible to support on an economically viable basis the supplementary numerical control operations which were started in Scotland last year, when market forecasts still indicated a possibility of expansion.
The hon. Member for Banff (Mr. W. H. K. Baker) said in the Scottish Grand Committee this morning that it was impossible that the change in Government could have led to a changed situation in industry since the present Government have been in office for only a year. But

the Press release shows that Plessey at the end of 1970 thought that its economic trends were on the right lines, but its production has fallen so quickly since then that the company has had to close the business.
My right hon. Friend the Member for Kilmarnock (Mr. Ross) has reminded us that the company has been sending work south. On that point the Press release said :
The company, therefore, very much regrets it has no alternative but to cease operations at the Argyll Works. Alexandria, Scotland, in order to maximise and safeguard its main resources in numerical control which have been firmly established in the South of England …
This is all too often the story when a firm has establishments in areas other than Scotland.
When the closure was announced, I wrote to the Secretary of State for Trade and Industry and put certain points to him. I should like to put those matters on record since they are worrying the unions and other people in the area. Inducements were offered to the firm to go to Alexandria. The normal inducements could not be offered because the equipment was already in existence. One point that should be made clear relates to the terms of sale and the inducements which were offered to Messrs. Plessey by the previous Government.
In lieu of grants for equipment, what was the price paid by Plessey? This was a Government asset which was being set aside, and the job was being offered to this firm on the cheap. I should like to know what is the situation now that the firm has decided not to carry out its obligations. Certain Government contracts for torpedo work were being carried out in Alexandria, and I should also like to know what steps are being taken to transfer this work elsewhere, and whether it is to go south of the border.
A most important point on which we should like a clear answer relates to the decision about reacquiring these premises. It is not just a matter of negotiating a price with Plessey. It must be made clear that the Government should take over this asset on the terms of sale which were offered to the firm ; otherwise this Government asset will be lost and the firm may make a profit out of a situation which has arisen because a


defence project involving the R.N.T.F. has been ended.
I have already raised the point with the Government on a previous occasion when part of the Plessey works was being closed. I received a reply from the Under-Secretary of State for Development at the Scottish Office, the hon. Member for Ayr (Mr. Younger), who I find very helpful in giving advice on these matters. The hon. Gentleman said in his reply that the Government were not prepared to take over these premises mainly because three advance factories are being constructed in Clydebank at this moment. I hope that when these factories are completed they will soon find tenants, but the people in Alexandria in the Vale of Leven will now have to find work in the area.
This is a close-knit industrial community and the people feel that they should be able to find work in the vicinity. Even though many workers travel to Singer's and John Brown's premises in Clydebank, work is needed in Alexandria itself. The Government should look again at acquiring these premises so that they can let them, with all the benefits of the special development area which the Government stress in their Amendments. It may be said that this large factory does not need to be re-occupied. I would point out that it is a factory of some 500,000 square feet, and it would be a blot on the landscape if this large industrial complex were left unused in the middle of the Vale of Leven.
Governments do not change very much in their attitudes. I remember some years ago when the firm of Denny in Dumbarton was to be closed and we took a deputation to see the then Minister of State, Lord Craigton. Lord Craigton told the deputation "Why worry about having industry in Dumbarton? Dumbarton is a pleasant little place—why not just become a commuter community?" This advice was firmly rejected because obviously an industrial community would never wish to become a purely commuter community.
Last week at Question Time the Prime Minister said that his Ministers went out of their way to see deputations. I wish to point out that on 27th May I wrote to the Secretary of State for Trade and

Industry to ask whether he would see a deputation. The answer I received was as follows :
… I do not think there would be anything to be gained by seeing a deputation to go over the ground again.
We had not even been over any ground on that occasion and we feel that in the present circumstances, since this is a Government factory, we have a stronger case than ever to meet the Minister.
The hon. Gentleman's last sentence was :
We shall be keeping a close watch on developments.
That letter was dated 30th June, 1971. On 1st July, I received a phone call from the Provost of Dumbarton saying that the factory was closing. It is small wonder that the people of Scotland are so anxious about our trading and industrial situation, when Government Departments keep that kind of close watch on developments such as this.

6.20 p.m.

Mr. Patrick Wolrige-Gordon: The situation we are debating today is extremely serious. The present unemployment position is the worst in Scotland since the war. That is true in terms of numbers. But numbers are not the whole point. Unemployment is bad for those unemployed, be they 9, 90 or 900, and in my view we want a national mobilisation for unemployment on the same scale and carried out with the same individual care as a regiment at war gives to those who need to be taken to a place of safety.
Certainly the Government have announced a major contribution today, with £8 million to be spent on an extended road programme, £33 million on additional works, special house improvement grants and special assistance to Glasgow. But there is a limit to what the Government can do, and I say that without regret because if the Government were able to solve the unemployment problem on their own they would be all powerful, and all the evidence suggests that the more powerful that a Government gets the more inadequate they become, irrevocably limited by the slenderness of their own human resources. Moreover, the limit on their activity imposed by a mixed economy helps to underline the fact that unemployment is everyone's problem and


not just that of the unemployed or of the Government alone.
I have been very struck by the number of people discussing the situation, especially in this House, who seem to think that the Scottish problem is immutable. I do not believe that. I have the greatest faith in the Scottish people. However, in many areas of British life there is a kind of prejudice that somehow, somewhere, someone else owes us a living. It has become almost an article of faith in Britain that one should live on the "get" and not on the "give", and that if one tries to live on the "give" one will be knocked out. I understand that feeling. However, with that philosophy, unemployment is inevitable, since no one cares about what happens to the next person in the queue.
Conversely, if we decided to live on the "give" and really shifted our production, our services and our way of operating, a new lift would be given to the country, to the economy and to our people. We in this House should try to encourage that kind of approach, because it is all too often a factor which is sadly missing. Often in this House, inevitably, events are interpreted in the narrow terms of party advantage, and one is liable to be told that any kind of change of the sort that I have suggested is impossible while the party opposite pursue its reactionary policies, whether they are to the Left or to the Right.
I disagree entirely. The great advantage of a free country is that the individual does not need to wait for the Government. There are a great many Scotsmen and women who have formed and are running successful enterprises which, to a greater or less degree, provide employment. There are people who take responsibility and try to make a practical contribution to solving the problem. Obviously the need is to multiply the number of such people. Public works are a necessary palliative of the present crisis, but the future strength of the Scottish economy depends on the extent, variety and number of its roots.

Mr. James Hamilton: The hon. Gentleman talks about the Scottish economy and about Scottish investment. Is not it true that there is a reluctance on the part of Scottish investors to invest

in Scotland? Then the hon. Gentleman talks about the workers of this country. However, even in his own constituency General Motors are operating, and that company will tell the hon. Gentleman about the finest workers in the country.

Mr. Wolrige-Gordon: I agree with the hon. Gentleman. What I have said applies to investment just as much as it does to everything else. We are told that it takes something like £2,000 of capital investment to employ one man. I should like to see some of the people employed in that way getting the chance of that money as capital loans so that they can get started themselves and possibly employ others later.
I also think that we should look very much more carefully at the suggestions of Sir John Toothill and others about a differential fiscal policy in Scotland for the sake of development. It is an idea which has been put forward already in this debate. I do not believe that we need to be too proud in Scotland.
There has been much talk already about the Common Market. One obvious effect of British entry inevitably will be an intensification of what is called the "Golden Triangle". Scotland is outside it. Therefore, development policies will be even more important if we go into the Common Market. In view of that, why should not Scotland be made a pilot example of the virtues as well as the most effective methods of diversification and regional development? At the moment, there is no other part of Western Europe which could provide such an opportunity.
I wish to say a special word about oil. My right hon. Friend the Secretary of State referred to it in his speech. In our position today, we must direct careful attention at anything which provides a real cause for optimism in the future. Is Scotland to become a booming oil country? If so, how long will the boom last? What plans can be made to see that the investment therefrom will be solidly based? I recognise that oil does not have a direct effect on employment to any great extent, but there is no question of the wealth involved, and it could affect my own part of the country in the North-East of Scotland. As my right hon. Friend said, B.P. is considering


landing oil from its Forties oil field in the North Sea, 110 miles from the coast, at Peterhead in my constituency. Peterhead is ideally suited for this kind of enterprise. I should like an assurance from my right hon. Friend that the Government will give every assistance that they can to this laudable enterprise.
B.P. is one company. There are now 400 blocks in the North Sea open for licence. The majority of those blocks are off Scotland. As my right hon. Friend has said, there are four major oil investment companies with predominantly Scottish capital. Will my right hon. Friend be able to ensure that Scottish interests are taken into account fully in dealing with these natural resources? Again, when some of the blocks are auctioned, can we be sure that Scotland gets the value of the money spent and its fair share of the oil royalties? I do not think that we are being selfish when we make a strong point of this.
England has always been a comparatively richer country, by the accidents of geography and size. In this matter of oil, it is just possible that the balance may be redressed somewhat. I believe that Scotland should have the benefit of the riches in her sea and that the Government should ensure this.
I conclude with a brief word about boat building. Not all the boat building in Scotland is done on the Clyde. In recent months, I have tried to make it plain to the Government that boat building in the smaller yards round the coast needs reconsideration.
In the North-East two leaders of the industry have given tongue to their concern about lack of orders. In earlier debates and in correspondence my hon. Friend the Under-Secretary of State for Home Affairs and Agriculture gave me to understand that if this situation persisted he was prepared to receive a deputation from these boatyards later in the year. Has he any proposals yet for such a meeting?

Mr. John Robertson: Would it not be wise for the hon. Gentleman to make sure that he received a deputation right away? Otherwise, the ferry ships being built for the Shetland-Orkney-Aberdeen run will have been built in the Faroes,

outside British shipyards, with British Government subsidies.

Mr. Wolrige-Gordon: I am aware of that. I am also concerned as a matter of policy. I do not blame any man considering investment in an inshore fishing boat, which would be built in one of the yards I have in mind, being very careful about pursuing his investment plan. I very much hope that account has been taken of the considerable advance which has been made in the Common Market negotiations as a result of my right hon. and learned Friend's discussions there last Monday. But, even so, I read in the Press at the weekend that the Highlands and Islands Development Board is being very careful about its investment plans for the industry during this difficult stage. I am sorry about that, but I fully understand the reasons for it. Nevertheless, this matter will presumably be resolved by October. I hope that my right hon. Friend will bring this debate to the attention of his right hon. and learned Friend so that the position of these yards, which in many cases is potentially critical, can be reconsidered in time.
A minor point concerns the credit facilities to enable the yards to compete with countries like France, Norway and Poland in supplying fishing boats to Southern Ireland. This industry is in almost the same state of suspension as the negotiations go on. However, I think that we should be in a position to compete with other countries in supplying these boats. Our own yards are highly competitive. This has so far been a matter of negotiation between the Department of Trade and Industry and the Scottish Office. Will my right hon. Friend tell us the result of these negotiations at the end of the debate?

6.33 p.m.

Mr. Russell Johnston: It is not only the rate of employment which is so distressing, but its spread throughout Scotland. The Highlands has a higher rate of unemployment now than for 20 years, despite the existence of the Development Board for over six years. There is a high unemployment rate in the small burghs in the east in Banff, Arbroath and cities like Dundee. Even in the Borders there is an unemployment problem for the first time since the war. In Glasgow, in the centre of Scotland, we see it at its worst with the tragedy of


U.C.S. and the problems of Plessey, and so forth.
Matters in Scotland are pretty grim, as the right hon. Member for Lanark (Mrs. Hart) said. I think that they are likely to get grimmer, despite the measures which the Secretary of State has announced, as we enter the winter.
It is not only the immediate future which I find worrying, but, far more serious, the long term future of balanced growth in Scotland, standing, as we are, at the door of Europe. That is important, and it worries me considerably.
We need immediate expansion in public works and the release of capital in the private sector. Houses are required to be built and roads to be constructed. I welcome the announcement made by the Secretary of State in this regard.
I am perhaps more attached to Keynes that the right hon. Member for Lanark. I have always believed that it is better to create work than to allow men to rot on the dole. Although our social security system makes unemployment less horrible, the misery remains as real and the waste as tangible.
It is important to look beyond the question of the expedient. Unless there is some vision there can be no hope and unless there is a plan there can be no defined progress. That is a criticism of this Government, frequently made by the Opposition Front Bench, which I accept. We cannot measure progress unless the Government say what they hope to do and in what time they hope to do it.
I want briefly to try to present in outline a Liberal answer to a major part of Scotland's problems, the kind of answer which a Scottish Parliament, if we had one, in a British federal system would be pursuing. I was interested to note the remarks of the hon. Member for Edinburgh, South (Mr. Clark Hutchison) who was talking about differential taxation. I welcome this kind of conversion.

Mr. Clark Hutchison: indicated dissent.

Mr. Johnston: The hon. Gentleman shakes his head.

Mr. Clark Hutchison: Mr. Clark Hutchison rose—

Mr. Johnston: Incidentally I admired the hon. Gentleman's courage. Knowing

his view on the Common Market, I visualised him waiting out the dreadful doomwatch sitting in his clock factory. That was quite a thought.

Mr. Clark Hutchison: I should like to correct the hon. Gentleman. It is not a conversion. I have been nattering about differential taxation for years.

Mr. Johnston: The trouble is that we need more than nattering. We need some firm commitment.

Mr. John Rankin: What is wrong with "nattering"? It is a common expression.

Mr. Speaker: Order. There is a great deal wrong with sedentary nattering in this House.

Mr. Johnston: I entirely agree, Mr. Speaker.
There are certain things which are, as it were, going for Scotland. I want to list them and try to fit them together.
As I said in the last debate on 3rd February, and as has been mentioned already, there is, off our shores, an unmeasured wealth of oil and gas from which we could benefit and which equally could pass us by. It was significant that the Secretary of State mentioned it. When I raised it in the last debate there was no mention of it from the Front Bench. Indeed, the hon. Member for Aberdeenshire, East (Mr. Wolrige-Gordon) has apparently discovered it, though he made a long speech on 3rd February without referring to it.
There is in the Clyde an unequalled asset—Scottish, British, European, call it what we like—as a deep water port, and related to it there are the skills of shipbuilding, which are now at risk, the opportunities to produce steel competitively with the world at Hunterston, the ore terminal, and the concept of Ocean-span linking Europe to the Americas.
There is in the Highlands and Islands Development Board, for all its limited activity, a body with powers and evolving expertise both to refashion the Highlands and also to be the prototype for similar exercises in the other regions of Scotland, perhaps fitting into the pattern of local government reform which may eventually come forth. Liberals have argued this for a long time. Indeed, my right hon. Friend the Member for Orkney


and Shetland (Mr. Grimond) mentioned a Highland Development Board in his maiden speech in 1950. My hon. Friend the Member for Roxburgh, Selkirk and Peebles (Mr. David Steel) introduced a Bill for a Border Development Board.
On 6th December, 1967, I asked the then Secretary of State for Scotland what forecast he could make
of a reduction in the number of jobs in Scotland in coalmining, heavy engineering and shipbuilding respectively, over the next 10 years ; and what related provision he proposes to enable those who are displaced to be retrained in other skills".
He replied :
it is impracticable to make firm forecasts for individual industries so far ahead, but measures to deal with training and retraining needs have been greatly advanced since the problems of structural change in Scottish industry were fully identified in the White Paper on the Scottish Economy."—[OFFICIAL REPORT, 6th December 1967 ; Vol. 755, c. 302.]
The Liberal Party found that an unsatisfactory answer. It is not that I am particularly chiding the right hon. Gentleman in retrospect for that answer ; I think that he deserves great credit for producing the White Paper and trying to make a forecast. The failure has been to try to make subsequent revised forecasts.
The Scottish Liberal Party set up a Committee under the chairmanship of Mr. R. A. Robertson, the Chairman of Hutchison Engineering. It reported in February 1968, and projected redundancies in shipbuilding, which have been justified, and argued for a super yard on the greenfield site. Events since then, and thinking since then, have led us to link this idea to other proposals to form a considered plan.
First, we would bridge the Upper Clyde position for two or three years, or perhaps a little more, thus saving the skills and the valuable equipment that is there, because much of the yard has been refurbished. Second, we would use that time and the confidence it would create to construct a new super yard on the greenfield site, making it a joint effort between the Government and the private sector. Third, and this the Secretary of State must do, we would go ahead with Hunterston, because a steel works only makes real sense in Scotland if it is linked to shipbuilding.

Mr. Brewis: Has the Liberal Party costed all these developments? Can the hon. Gentleman give us any idea of what they would cost?

Mr. Johnston: I shall come to that in a moment. The hon. Gentleman is right to be concerned about the cost. His Government are not profligate with money. That is one thing of which they cannot be accused.
Japanese steelyards can produce about 250 tons a year, and aim to produce about 700 tons. Those are the figures for individual plants. The British figure is 150 tons. It has been estimated that Hunterston could produce up to 800 tons. The fourth thing is Oceanspan. I mentioned this in the debate on 3rd February. It cannot be left to the Clyde Port Authority. It is something which the Government must take up.
If those things were fitted together, they could represent a considerable industrial revolution in Scotland. This all costs money, and I now return to the question of oil, because this is not merely the meanderings of a Liberal. I am not alone in holding the view which I expressed during the debate on 3rd February. The magazine Scotland, issued by the Scottish Council for the Development of Industry, this month poses the same questions which I posed during the debate, and to which I received no answers from the Minister.
First, what will be the revenue from the granting of franchises? Will it be £20 million, £50 million, or £100 million? Where will the money go? Will it go straight to the United Kingdom Treasury? I suppose the answer is "Yes". Will Scotland get any allowance for it? I fear that the answer is "No".
Second, what will the royalties yield? The magazine Scotland estimated the yield at about £100 million, which is quite a lot of money.

Mr. Douglas: The line of thought which the hon. Gentleman might like to pursue is who will get the rates for the rigs?

Mr. Johnston: That is a good question. Where will the work go that will be involved, both in the drilling and on shore? The magazine to which I have referred asks whether Aberdeen, which


is ideally situated, will derive any benefit.
Money is there, not only for the Clyde, but for related development in the East and to provide backing for regional development elsewhere. The Highlands and Islands Development Board has had £8 million—that is about 1¼ miles of motorway a year—over the period of its existence, and one cannot expect to make any fundamental change in an area the size of the Highlands with that kind of money.
The Robertson Plan is an integrated plan which could offer a viable future and, as I said on 3rd February :
If our problems are to be solved, more urgent and radical measures will be necessary than have so far been taken."—[OFFICIAL REPORT, 3rd February, 1971 ; Vol. 810, c. 1774.]
I repeat that, and I do it, as I believe a Liberal always should, having made constructive suggestions which can be criticised, because these debates ought to be used as constructive occasions rather than as opportunities for mutual recrimination.

6.45 p.m.

Mr. Ian MacArthur: I was interested to hear the speech of the hon. Member for Inverness (Mr. Russell Johnston). I was glad that he, too, referred to the enormous excitement over the discovery of oil off Scotland. We know that the oil is there. The indications are that large strikes could be made, and I believe that these could result in a flow of wealth into our country to an extent which we can hardly begin to grasp.

Mr. Rankin: But not into Scotland.

Mr. MacArthur: The choice of this subject for today's debate was not unexpected. The unemployment rate in Scotland is alarmingly high, and the industrial scene has been darkened latterly by the agonies of Rolls-Royce and U.C.S. There have been other blows, too, such as that described by the hon. Member for Dunbartonshire, West (Mr. Ian Campbell), in whose constituency the Plessey factory lies.
It is natural that the Opposition should have selected unemployment as the subject for debate on this Scottish Supply Day, and it is right that we should debate

this problem which, directly or indirectly, affects every person in Scotland. As my hon. Friend the Member for Aberdeenshire, East (Mr. Wolrige-Gordon) said, unemployment is everyone's problem, whether unemployed or not, and the growth of unemployment in Scotland has certainly stripped too many people of their jobs.
But it is wrong of the right hon. Member for Kilmarnock (Mr. Ross)—and I am glad that he is back in his place—to have mounted his assault on the Government in the way that he did. His speech will not bring much comfort or hope to the army of unemployed to which he referred. It is an army of unemployed, and I believe that the quality which we need to restore in Scotland, and which the army of unemployed needs, is that of confidence. There was nothing at all in the right hon. Gentleman's speech to build confidence or to point to those areas in which we can justifiably say there is confidence. I think that the right hon. Gentleman did no service to his constituents, or to the people of Scotland, by blackening the outlook for Scottish industry in the way that he did.
We are used to this sort of dreary dissertation from the right hon. Gentleman, and I make no complaint about that, but it is curious to hear him berating the Government for the situation that we face. What, one may ask, was the right hon. Gentleman doing during those long, long years between 1964–1970 when he was presiding over Scotland? I remember one thing that he did. He published his notorious White Paper, to which I refer often, and—

Mr. Douglas: Not again !

Mr. MacArthur: —I shall go on referring to it. I recommend right hon. and hon. Gentlemen opposite to read it every day and, when they go to bed to read it there. If they do, they will have nightmares when they realise the extent to which they muddled the economy, fiddled the election and misled the people of Scotland.
In January, 1966 the right hon. Gen-leman published his great White Paper on the economy. He set as his target the creation of between 50,000 and 60,000 extra jobs. That was the main theme of the document, and I remember the Press release which the right hon. Gentleman


put out to all the newspapers in Britain. It had as its opening words "More jobs". That was his promise to the people of Scotland. They were to get 50,000 or 60,000 more jobs. Of course we did not get any more jobs at all.
What happened was that by the end of the period we had lost 82,000 jobs. The right hon. Gentleman missed his target by a total of 142,000 jobs—the 60,000 that we did not get and the 82,000 that we lost. Yet right through his period of office the right hon. Gentle-clung obstinately to his discredited White Paper and treated our constant questions with constant contempt.

Mr. Ross: Hear, hear.

Mr. MacArthur: It is also strange to hear the right hon. Gentleman claiming credit for removing S.E.T. from some hotels in Scotland. He pointed to this in reply to an intervention of mine.
He may take pride in that if he wishes, but who was it who imposed selective employment tax on the hotels in Scotland? It was the right hon. Gentleman himself. In January, 1966, in the notorious White Paper which I have mentioned, just before the election, the right hon. Gentleman wrote that special attention would be given to tourism. Special attention is what tourism got—the special attention of the selective employment tax—in May, four months later.
The right hon. Gentleman, who accused the Highlands of whining about selective employment tax, applauded to increases in selective employment tax and then realised too late the harm it was doing, and he and his right hon. Friend the then Chancellor of the Exchequer at last and belatedly removed the tax from one of the most sensitive areas in Scotland, the Highlands, but restricted the removal to hotels alone. To hear the right hon. Gentleman take credit for that is to be reminded of the parent who claims to be kind when he stops bashing the baby. When the right hon. Gentleman was in office and looked to the future, he failed miserably on every count. On that record, no one in Scotland will pay much attention to what yesterday's man has to say about tomorrow.
If we look through and beyond the extremely discouraging unemployment

figures in Scotland, we find that there is some evidence to give us encouragement for the future. Since the war, under successive Governments, the structure of our industry has changed fundamentally, much more so than people generally realise, As the older industries have declined, so the newer industries have advanced. The pace of advance has certainly not been enough to replace each lost old job by one new gained job, but the modernising change in the nature of employment in Scotland has been progressing for 20 years or more.
A visitor returning to Scotland today after a long absence would hardly recognise the scene, certainly in the industrial belt. It is a new Scotland in which we live. Certainly the shadow of unemployment hangs over the industrial belt and beyond, not least in my constituency, but that shadow should not be allowed to obscure the fact that we have a healthy modern base of opportunity from which to expand and it is expansion which we need now.
We need above all to exploit that opportunity to provide new modern jobs, to bring to an end the chronic gap between employment levels in the North and the South. My right hon. Friend will agree that some of the Budget measures earlier this year are only now beginning to have effect, because they took effect only a week or two ago, and we can expect that they will contribute to an upturn in the economy soon. I trust that the likely extent of that upturn will be considered by my right hon. Friends with the utmost care, because it may not be enough to produce the resumption of growth which we need. There are other measures which the Chancellor could take, and I am certain that there will be no hesitation about taking those further steps if they can be taken without the risk of swinging the country back into a renewed burst of inflation.
We were told today by my right hon. Friend of a welcome range of actions, £33 million worth, to inject additional employment into Scotland, and I warmly congratulate my right hon. Friend on this initiative.

Mr. Ross: It was £35 million. I know because I have had the advantage of reading it in the Evening Standard.

Mr. MacArthur: I am obliged to the right hon. Gentleman. I understood it to be £33 million. It is a very substantial and welcome sum. These measures will bring great relief at the very time when relief will be sorely needed.
My right hon. Friend will agree, however, I am sure, that, excellent chough these measures are, they are essentially short-term measures and in themselves will not meet our longer-term need, which is the provision of securely based long-term employment.
We have often discussed the relative merits of investment grants and investment allowances as a means of encouraging industrial development in Scotland. I have no doubt that the present system is likely to be more beneficial, but any incentive to encourage industries to move and develop can be effective only if industry is in a mood to move and develop. There is not enough of that mood today, but I suspect that a relatively small change in the economic climate would transform the position and spur on the confidence which we need for investment and expansion. It requires relatively little to tilt the balance so that we may enter a period of growth.
Contrary to what has been said by hon. Members opposite the position is not entirely that of stagnation. In the six months from December, 1970, to May, 1971, the number of I.D.C.s approved represented 6,170 jobs. Certainly that is not enough, but that compares with an increase of 4,260 jobs in the equivalent period a year previously, when the right hon. Gentleman was in power. It is an increase of 45 per cent. and it is worth pointing to that figure. It is not enough, but it is certainly much more than a drop in the ocean of need.
We urgently need more expansion. I suggest that it is the state of the total United Kingdom economy which matters most. What Scotland needs for growth is growth in the total economy, because it is only then that the incenives to move and develop can have any real effect. The prospect for Scottish growth must be set in the United Kingdom context, certainly in the short and mid-term. If that is right, and I believe that it is, it must be right also to set the Scottish economy in the European context.
In the longer term, our manufacturers in Scotland would have direct access to

a vast European home market, and foreign investors would see Scotland not only as part of the United Kingdom, but as part of Europe and so as a base for serving Europe. It is worth remembering that in the years after the last war American industry saw Scotland as a base from which to gain access to the Commonwealth and the sterling area, and there were many American developments in Scotland, accounting for some 10 per cent. of our employment. This was welcome employment and it was a most important development in the Scottish economy. In much the same way, and perhaps much sooner than we expect, expanding industry on the Continent will look to Scotland as a base for expansion.
Entry into the E.E.C. will produce an additional stimulus to development of the economy in Scotland, and I am sorry that the right hon. Gentleman made his silly remark about the visit to Germany by my right hon. Friend the Minister for Development. That visit and his discussions were looking ahead constructively, but that, I appreciate, is an approach which the right hon. Gentleman is unlikely to comprehend.
My right hon. Friend did the House a service by reminding us of what the right hon. Gentleman had to say about the E.E.C. two years ago, but since then the right hon. Gentleman has been playing "follow my leader".

Mr. J. Bruce-Gardyne: A difficult task.

Mr. MacArthur: It tends to make one giddy.
According to the Sunday Mail, two days ago, in a clarion call to the people of Scotland, the right hon. Gentleman said :
There's nothing much you can say about my view until we can have our various conferences".
That was in answer to a question about the E.E.C. That is the quality of leadership which the right hon. Gentleman offers to us and his alleged followers in Scotland—he will do what the various conferences tell him to do.
On this crucial question he leads his regiment from behind. Like the Duke of Plaza Toro he may find this more exciting, but it is a curious form of leadership for the right hon. Gentleman to display


to those in Scotland who he claims follow him.

Mr. Alexander Wilson: Is the hon. Gentleman suggesting that the ordinary citizen has no right to say whether or not we should join the E.E.C? In other words, is he suggesting that hon. Members should not listen to their constituents, to the voters and their organisations, on this issue? What is his idea of democracy?

Mr. MacArthur: My idea of democracy is that an hon. Member should say what is in his mind. He must, of course, discuss this and all problems with his constituents. It seems odd that the leader of a once great party in Scotland, having declared his view two years ago, should suddenly dodge the issue and sit on the fence at the crucial moment when people are supposedly looking to him for guidance and leadership. That is what the right hon. Gentleman has been doing over this issue.
There are three stages of opportunity in Scotland. First, in the short-term, the further and massive injection of funds announced today, coming on top of the measures which my right hon. Friend announced recently, will provide more jobs, and do so quickly, but these are essentially short-term measures.
Second, in the short to mid-term, the resumption of growth in the United Kingdom will act as a spur to growth in Scotland, where we have a healthy industrial base from which to expand. However, I remind my right hon. Friend that unless there are indications of growth in the total economy soon, we will not stimulate investment and get the expansion we need.
Third, in the mid to long-term, we have the great opportunity which our entry into the E.E.C. will provide for Scotland. The immediate scene is grave. As the Government Amendment states, unemployment is regrettably high. I would call it intolerably high. Yet there are grounds for confidence and, far from it being complacent to point to them, I believe that it is irresponsible and damaging not to point to them. Beyond the present gloom there is reason for confidence because there are large new opportunities for Scotland, and a strengthening base from which to grasp them.

Several Hon. Members: Several Hon. Members rose—

Mr. Deputy Speaker (Sir Robert Grant-Ferris): It is just after seven o'clock. This might be a convenient point for me to point out that I have been informed that many hon. Members wish to speak in this debate. I calculate that if each speaker takes not more than ten minutes, nearly all, if not all, those wishing to take part will be able to speak.

7.04 p.m.

Mr. Robert Hughes: I will not follow the hon. Member for Perth and East Perthshire (Mr. MacArthur) in his peregrination around the Common Market. I hope that I will be fortunate to catch Mr. Speaker's eye when we debate that subject next week.
It is clear that the injection by the Secretary of State and hon. Gentlemen opposite of the whole subject of the E.E.C into this economic debate has simply been a smokescreen to cover up the ills of the past 13 months of Tory rule.
We seem always to be dealing with a gloomy situation in Scotland. The picture is always dull. It is understandable that my hon. Friend should be pessimistic rather than optimistic because many of us have been through redundancy or the fear of it and the closures or the fear of them. We have lived through these things in the firms which employed us before we came here.
For the last 20 years or more we have debated the decline of the Scottish economy. We have a dream that one day we ill discuss Scottish economic affairs and they will be in a healthy condition—that we will have the same kind of overheating problems that seem to occur with unfailing regularity in the South-East of England.
For a while under Labour there was a degree of confidence in the future. There was a glimmer of hope that the Scottish economy was beginnin gto up-turn a little. Six years of Labour Government produced considerable expansion of the infrastructure. New modern industries were beginning to establish themselves in Scotland and we had high hopes of great expansion. But, unfortunately, the pace of progress has not been contnued.
When I spoke in the debate on the Gracious Speech on 9th July I welcomed the prospect of a computer memory manufacturer coming to Aberdeen. Sadly, this


prospect is no longer as certain as it was. The company concerned decided that it had to postpone the building of a new factory, and I understand that a final decision whether or not to come to Aberdeen will not be made until the end of this year. The reason for this change of heart is that the general economic situation of the country does not warrant the firm going ahead with its expansion plans. I am pleased to note, however, that the company does not have a closed mind to expanding in this way, but I must admit to being a great deal more pessimistic than I was some time ago.
Industries with growth potential are, of course, welcomed because they have financial backing. However, they are hesitant to commit themselves. Even more damaging, of course, is the picture of new industries closing down and leaving Scotland to return south of the Border.
The Government's regional policy has definitely changed for the worse. The change to tax incentives away from the cash grants that were available under the Labour Government have made a big difference. I accept that hon. Gentlement opposite, being loyal Conservatives, will not accept what I say, and I therefore draw to their attention an article which appeared in the Aberdeen Press and Journal of 8th July last under the heading :
No Ross Smelter but for Labour Grant".
The report was of a statement to hon. Members made by the chairman of the British Aluminium Company who, when giving evidence to the Select Committee, said according to the report :
We were strongly influenced by the investment grant and its availability on this scale. We would not have gone ahead without it.
In other words, the chairman of one of the biggest capital-intensive industries in the country was making it clear that under the present system he did not believe that his company would have gone north. Capital-intensive industries are important, although the kind of industries we want in Scotland are labour-intensive.
What other items of policy do the Government have to help alleviate hardship in Scotland and overcome some of our problems? There was an interest-

ing interchange at Question Time on 8th July, and although it was in relation to Southend—it was about the dispersal of Government personnel from London—the answer given by the Prime Minister, who had been charged with indifference, was interesting. He said :
As to indifference, it was under Conservative Governments that both the main initiatives for dispersal of Government personnel from London were taken. They were taken in 1963 by a Conservative Government, and by myself in this Conservative Government."—[OFFICIAL REPORT, 8th July, 1971 ; Vol. 175, c. 1518.]
HANSARD, of course reported accurately the words uttered by the Prime Minister, but neither our OFFICIAL REPORT nor any other report could possibly reveal the flavour and tone of the right hon. Gentleman's remarks. The words do not savour the mood in which the Prime Minister was that day. The right hon. Gentleman was in his most arrogant mood, pointing out how on both occasions the Conservatives had done something to disperse Government personnel from London.
I advise the right hon. Gentleman to look at the record. He will see what happened as a result of that famous dispersal policy of 1963. The Scottish unemployment total was 105,000 and the total net migration that year was 40,000. The only other year in which unemployment approached that record figure was 1959, when the average for the year was 95,000 unemployed, with an annual net migration total of 25,000.
In the first year of Tory Administration we are again over the 100,000 mark. The House and country will have noticed the strange coincidence that in years of Conservative Administration we have extremely high unemployment figures. It is no use hon. Gentlemen opposite calling this a coincidence. The previous occasion was after 13 unlucky years of Tory rule—unlucky for the country in general and for Scotland in particular. Instead of boasting, the Prime Minister should have approached the Dispatch Box with some shame for the damage which he and his Administration have continually done to Scotland.
On the dispersal of Government personnel, if the Prime Minister wishes to live up to his words about producing some diversification and dispersal, he


should take up the suggestion made in this month's magazine Scotland, which suggests that Aberdeen could become a major oil centre. This is possibly the only thing which the hon. Member for Aberdeen, South (Mr. Sproat) and I have in common. We both wish to see a great expansion of the oil industry in Aberdeen and the North-East. The magazine suggests :
North Sea activity has pushed London to the fore, because it is there that the international companies can contact the Government—in this case the Department of Trade and Industry, Petroleum Division. This could equally well be sited at Aberdeen and would act as a magnet for the companies who at the moment set up their European bases in London.
I hope that the Government will act on this proposal and do us the service of providing the magnet to attract all kinds of new industry to Aberdeen.
By their hag-ridden dogma the Government have allowed U.C.S. to go to the wall. Despite the consequences to the Scottish economy, they have done nothing to prevent U.C.S. landing in difficulty. For the shipyards the difficulty is not confined to the Upper Clyde. Many people in my constituency work in the small shipyard of John Lewis and Company, which strives hard to expand the order book and to try to modernise and slough off its extremely bad history of bad industrial relations and antiunion managements. None of these things is possible without firm order books on which to base the future. People cannot spend money on new machinery unless the future prospects justify it. It cannot inspire the workers to be more flexible unless there is a very firm order book.
The John Lewis shipyard tendered for four ferries for the Shetland Islands, worth £500,000, on an extremely competitive basis. All of us in Aberdeen were extremely concerned when this order, which has Scottish Office approval—I understand that about 75 per cent. of the cost is to be met by the Scottish Office—went to the Torshvn shipyard in the Faroes. The Aberdeen Press and Journal again mentions this :
Four car ferries costing more than £500,000,.. are to be built in a foreign yardd because the price is 'considerably less' than any British yard can offer.

It goes on to say :
Representatives of the council and our consultants visited Faroe and were satisfied the yard was capable of producing a first-class job. And the Faroese Government are guaranteing that the vessels will be delivered at the stated price.
It has been suggested that the guarantee goes much further than the Faroese Government giving a guarantee regarding the stated price for delivery. It is suggested very seriously that the Danish Government has guaranteed this shipyard against all loss appertaining to this order. If this is the case, there can be no competition on the order.
It is the duty of the Scottish Office, especially where development areas are concerned, to make absolutely certain, first, that tenders are competitive, and, second, that there should be a direct channelling of work towards the development areas. It is no use waiting until companies get into distress and are almost closing before weeping crocodile tears and trying to do something about it. The time to do something about it is now, when the company is trying to expand. The Government have been sadly lacking in this respect.
The Government's attitude on unemployment is best typified by the psychology of the statements made in the past by leading members of the Government. None of us in Scotland will ever forget the occasion on which the Prime Minister, then Leader of the Opposition, was interviewed on Scottish Television about tax incentives and investment policy. He received a reasonably hostile interview because the interviewers were concerned about the cuts he was promising to make if he obtained office—which, in the unfortunate event, he did—and the kind of damage which this would do to the Scottish economy. His attitude to Scotland was, "Do you want a soup-kitchen country in a soup-kitchen economy? "This kind of grotesque insult to the people of Scotland hits hard and he will not be forgiven for it.
Our forebears outside and inside the House know the soup-kitchen as the reality of every-day life, the reality of the unemployed. The Government have conjured up out of the nightmare of the past the reality that perhaps not too far in the future the soup-kitchen will be with


the people of Scotland. We can almost forgive the Government for not knowing of the unemployment and hardship or to what extent they affect us. But what we can never forgive is that they do not care a damn about the people and the unemployment in Scotland.

7.16 p.m.

Mr. John Brewis: For at least 10 years I have been taking part in debates about the Scottish economy. I assure the hon. Member for Aberdeen, North (Mr. Robert Hughes) that the ills of the Scottish economy have certainly not started in the last 13 months. It is wrong to suggest that all was well under the previous Labour Government. My hon. Friend the Member for Perth and East Perthshire (Mr. MacArthur) pointed out the loss of 82,000 jobs, which was very bad compared with the performance of the previous Conservative Government, when there was a net gain, in a very difficult time, of 76,000 jobs. On top of this, in 1966 there was the highest rate of emigration from Scotland of 47,000 people.
The right hon. Member for Kilmarnock (Mr. Ross) presided over a very rapid rundown in the coalmining and shipbuilding industries. I notice that the right hon. Lady the Member for Lanark (Mrs. Hart), who graced our debate for a short time and has now left the Chamber, mentioned the possibility of public ownership and of diversifying employment opportunities. It is interesting to consider what the National Coal Board did in Scotland in the five or six years of Labour Government. Forty-nine collieries were closed and 4,532 jobs were lost. Fifteen of these collieries were in the right hon. Gentleman's county of Ayrshire, in which there was a loss of 1,193 jobs. In Sanquhar, for example, the rate of unemployment rose at one time to 25 per cent. But now, with the introduction of a new industry, Century Aluminium, in which my hon. Friend the Member for Dumfries (Mr. Monro) had some part, unemployment is falling.

Mr. Alexander Wilson: Why did each one of these collieries close? Was it through seam exhaustion or on economic grounds? What were the reasons for closure?

Mr. Brewis: Largely because coal priced itself out of the market.

Mr. Ross: I know a lot about Sanquhar, and one of the reasons why the colliery there closed was complete exhaustion. The hon. Gentleman mentioned what his hon. Friend the Member for Dumfries had done, but he did not mention what the Labour Government did. We made it a special development area. We introduced Templeton's Carpets, Trends Carpets and aluminium—at least three new industries. The hon. Gentleman should say how many have closed under his Government.

Mr. Brewis: Would the right hon. Gentleman like to say how many industries came to Galloway, my constituency, under his Government? I am very happy to agree with him that there have been new industries introduced into Sanquhar and that his Government made it a special development area.
The Scottish economy is very dependent on the United Kingdom economy because we rely so much on the local employment policy inducing industry to go to development areas.
The hon. Member for Aberdeen, North complained about the inducement system for getting industries to development areas. It is a good package of inducements now and it was a good package of positive inducements before. At present the only negative inducement is the I.D.C. system. I do not say for one moment that the I.D.C. system should be abolished ; because it has the effect of bringing to the attention of industrialists the attractions of a development area. However, in view of the number of I.D.C.s granted in non-development areas I wonder how effective the system is. In 1960–64, for example, 91·5 per cent. of all I.D.C.s were granted in non-development areas. In 1965 the proportion fell slightly to 90 per cent.—virtually no change. In 1969 it was up again to 92 per cent.
We need a stronger form of negative inducement to get industry to move from over-heated areas to development areas. When I journey by train through England I am surprised to see how much industrial building is going on. Sometimes there is an obvious reason for the location of a factory in a particular place. Obviously grand pianos cannot be made in the Western Isles, for example. However,


on going to London Airport by bus one wonders whether it is necessary to have a Cherry Blossom boot polish factory at Chiswick, more or less in central London. Going a little further afield, speculative developers are erecting industrial factories at Iver, near Slough. There is a toothpaste factory at Taplow. Even in Banbury they make instant coffee, employing about 2,000 people. All these are developments which have taken place in the last 10 years or so.
There is a case for looking into the problems of congestion in non-development areas. We in the Select Committee on Scottish Affairs asked some questions about this of the Board of Trade. It then seemed that little study had been done on this subject under the last Government or the one before that. I hope that this Government will look into this position, because far more needs to be done to induce industries to go to development areas.
Much has been said about the opportunities Scotland will have when we join the Common Market. I do not wish to say much about it. Undoubtedly the E.E.C. is sucking in labour from many outside countries like Yugoslavia, Turkey and Greece, and there is industry which needs to be exported from the E.E.C. to areas of high unemployment. In view of the way that German industry has developed in Southern Ireland, I think that we have missed out in the past in looking for the developments we have got from America, because we could probably have got developments from parts of Europe. I therefore congratulate my hon. Friend the Member for Ayr (Mr. Younger), the Under-Secretary, on looking into this, and I wish him all success.
I turn to a constituency point, though I think that the principle of the matter is relevant to much of rural Scotland and particularly to the subject of land use, which subject we are now considering in the Select Committee on Scottish Affairs.
For years Wigtownshire has suffered from high unemployment and high migration. Although it has been a development area for many years, no factory employing men has been attracted to the area nor, in view of the higher grants now available in Central Scotland, is it likely that such a factory will come there.
When it became clear that the Shoeburyness gun-proving establishment would

have to move from Foulness because of the new airport, I know that my right hon. Friend the Secretary of State for Scotland worked very hard in the Cabinet to get it to come to Wigtownshire, because it meant a net increase of about 350 jobs, mainly for men, over those at present employed by the Royal Aircraft Establishment at West Freugh. Whatever one's views may be locally about this problem, one should thank the Secretary of State for his efforts on our behalf.
As I said in an intervention, we in my part of the world are used to defence establishments : there has been an R.A.F. bombing range in Luce Bay for at least 30 years. During the war there were many other establishments, including a gunnery range at Burrow Head, and there is still a tank firing range at Kirkcudbright. We are used to the R.A.F. occasionally dropping bombs on its bombing range in Luce Bay. We are used to the test flights of Concorde going overhead. These are intermittent noises.
The gunnery range is in a completely separate category. Some hon. Members may know that the noise from a gun is about three times as bad in front of the muzzle as behind it. At Foulness there is a straight coast and most human habitation is behind. But firing into a bay means that many people along the coast are living in front of the guns.
When an experimental gun fired about 60 rounds on 25th June, there was a moderate wind from the South-West which protected the Mull of Galloway. However, on the east coast of Luce Bay the sound was excruciating. At Stairhaven the ground shook from the noise of the gun, and I am told that pig lamps were broken by the vibration. All along the coast, doors and windows rattled. It was many times worse than the biggest bombs the R.A.F. has dropped. Such a level of sound might be tolerable occasionally, but the gun position is scheduled to fire on 225 days a year a total of 20,000 rounds—that is, every working day Monday to Friday about a round every five minutes or so.
I do not think that anyone could go about his business in Stairhaven without wearing ear mufflers. We know that the guns will kill tourism all along the coast from Glenluce to Port William and probably in a wider area. Tourism is a


tender plant. There are only two little areas in Northern Ireland where there is any trouble and they are not areas where tourists normally go, yet the tourist trade in Northern Ireland has withered since the trouble started. Yesterday a bank manager told me that his branch at Stranraer alone had taken £1 million in tourism every year. Therefore, the money from tourism is by no means chickenfeed.
I do not think that it is equitable that people who have established caravan parks or made improvements to their hotels or property should suddenly have their work ruined by the noise coming from a gun range, and there is no possibility of their getting any compensation.
Yesterday the county council voted by one vote in favour of a gun range but by a much larger majority in favour of a public inquiry. I hope that my right hon. Friend will be able to give us this and tell us so tonight, because it is a very unpleasant atmosphere when people start questioning each other's motives. One side says that the other side is not interested in unemployment. The other side says that the other people are not interested in amenity. It would be the fairest thing possible if there could be a public inquiry presided over by somebody of the status of a judge of the Court of Session, and thereafter we would be prepared to accept his decision.
I want to raise two other small points which could not be taken into account in the county council's deliberations. Even taking over 2,500 acres of good arable ground there is not room to get more than eight of the 14 Shoeburyness gun facilities into the site there. This is utterly uneconomic and not sensible. Would it not be much better to find a bigger site on which the whole establishment could be set up all together?
Second, millions of pounds have been spent on the R.A.E. station at West Freugh. For example, there has been the extension of the runway, only just completed. If that establishment has to move, more millions will have to be spent re-establishing it somewhere else. Would it not be much better to settle for an increase in experimental work and, possibly, more employment at West Freugh, even though it might mean more

bombing in the bay? I feel sure that the local people would accept that with gladness rather than have the proposed gunnery range.

7.31 p.m.

Mr. William Small: On the question of defence establishments, the hon. Member for Galloway (Mr. Brewis) made his case, and his attitude is clear. On the question of joining the E.E.C., I find that a smoke-screen is raised all the time. I am always interested to see the man who becomes a 100 per cent. European, and I am watching the performance of right hon. and hon. Members opposite with close attention. At one time the great cry was for the abolition of British Standard Time. Here was a move for synchronisation between ourselves and Europe, but then came the great cry—it appeared in election addresses too—"Let us do away with British Standard Time"—bash the Labour Government, and bash B.S.T. I am waiting to see what hon. Members opposite do about reintroducing the principle of synchronisation with Europe as a first indication of their faith. It will be interesting to see what the Scottish Tories do.
My purpose is to deal with unemployment, and in the context of what is happening in Glasgow, in particular. Never have there been such scenes within living memory—at least, I have never known them—as the great demonstrations which have recently come down to London. What is happening to our communities in Scotland today? I have to speak up for the unemployed. I have been one of them in my time. I walked the streets for a long while, and I know something about it.
There is a great sense of concern in the community now. In George Square already, a petition has attracted 100,000 signatures. What is the concern about? First, there will be children weeping at home this weekend because their parents are not taking them on holiday this year. What can their fathers and mothers say? There is a dethronement of the authority of the parents because the children feel that they cannot provide them with the amenities which other children can have at this time.
The children who are leaving school have been cheated. In the old days, the


idea was that the workers would be educated beyond their station by our public education service. Now, people know their rights, they know their anticipations, and they know their true station. Under both Governments, a great education prospectus was launched. Our children are going through the schools and colleges, and passing out with flying colours, but at the end of the day they are cheated and robbed of their prospects of employment.
Nothing could be worse. Wherever one looks about the world—never mind about Tupamaros and people like that—a sense of deprivation is the incubator of crime, and that is no help to the cause of freedom and good order in our society. People feel that they have no objective when they have no job and no prospect of getting one.
I say these things out of great concern and a sense of duty. I am not talking about economic man. I am talking about what unemployment means in terms of deprivation and humiliation for men and women and for their children at school. When children see that their parents cannot provide them with the generality of things which give them a sense of status in this country—there are those, for example, who can have a car, even though a second-hand one—they have a real sense of deprivation.
To adopt what the Duke of Edinburgh once said, it is time this Government got their finger out and did something about it.

7.34 p.m.

Mr. Iain Sproat: The hon. Member for Aberdeen, North (Mr. Robert Hughes) raised the question of the Shetland ferries being built in the Faroes. He will not be surprised to know that I entirely share his concern in this matter, and I have already raised it with the Secretary of State for Scotland. I ask the Minister to tell us tonight whether, even if these ships cannot be built, as I should like them to be, in Scottish yards, we can be certain, at least, that the repairs, when they come up, will be done in Scottish yards. That would go some way to allay people's fears, particularly among the trade unions, a delegation from which came to see me last week.
We have heard a lot of gloom and despondency from the Opposition today.

I do not disagree that there is a lot to be gloomy and despondent about—the U.C.S. affair, the Plessey affair, the totally unacceptable high level of unemployment, which concerns us just as much as it concerns hon. Members opposite—but I wish to present the other side of the picture, too. It is this other side of the picture which makes me profoundly confident about the medium and long-term future for Scotland.
Moreover, today's announcement by my right hon. Friend of the short-term injections of capital which we are to have will go a long way to alleviate much of the short-term distress in Scotland today, I congratulate my right hon. Friend on the sums involved, which, I suppose, must approach about £40 million, including the house improvement grants which he announced earlier this month.
I have considerable confidence in Scotland's economic future. First, we now have an excellent investment incentive package. It is a package which is generous, comprehensive and flexible. In spite of what was said by the hon. Member for Aberdeen, North, I entirely support the switch from grants to allowances because I believe that, in the long term, this cannot but create jobs and create viable industry. It is no use just creating industry which cannot go on providing jobs. So I entirely agree with the switch from grants to allowances. We can still have grants and loans, when we need them, under the Local Employment Act, which, as the very name suggests, is operated by reference to the amount of employment which can be given.
Edinburgh and Portobello have been given intermediate area status. We have created a special development area in the West of Scotland, with improvements and advances in building grants, rent-free factories for up to five years, 30 per cent. operational grants, free depreciation, training grants, removal expenses grants, infrastructure improvement grants, and regional employment premiums until 1974.
The only point—I put this to the Under-Secretary, my hon. Friend the Member for Ayr (Mr. Younger)—at which I should like to see an improvement is that in the special development area it should be possible to give some of the benefits to companies already there.


What we are looking for is increased production and more jobs. It does not matter whether a company comes in from outside, from further than 30 miles, or is there already. I ask my hon. Friend to consider that improvement, although I emphasise again that, overall, we have an excellent investment package in Scotland.
My right hon. Friend, in opening the debate today, mentioned the subject of housing reform. I very much welcome what he said. This is all tied up with the whole question of Scotland's economic future. In Scotland today, we hold, alas, three wretched records in housing. We have the most houses in public ownership in the whole of the United Kingdom, we have the most overcrowding in slums in the whole of the United Kingdom, and we have the most absurd level of rents in the whole of the United Kingdom.
I do not believe that it is coincidence that we have all those three factors together. It is obvious that the housing situation in Scotland deters companies which would otherwise be keen to take up the advantages which we can offer. They are put off by the appalling housing which, all too often, is to be found in Scotland today.

Dr. M. S. Miller: Can the hon. Gentleman tell me what is absurd about a rent of £4 a week for a Scottish family whose main wage-earner is earning less than £20 a week, and when there is heavy unemployment in Scotland?

Mr. Sproat: My point is that the level of rents in Scotland is roughly half the average in England, which leads to a situation in which there is not enough money to plough back into improving the housing. Cases such as the hon. Gentleman raises will be covered under our scheme, because we shall give rebates to those who do not have the income to pay the fair level of rent.
Apart from the question of executives being put off coming to Scotland to new industry, I should be very interested to know whether any estimates have ever been made of the impetus to emigration from Scotland which the bad housing there over the years has given. I hope that the position will be greatly improved

by my right hon. Friend's proposal for housing reform.
I agree that we have an excellent investment package for Scotland, but, as many hon. Members have said, until we can activate it by overall United Kingdom growth we shall not see the full advantages which it could bring. Therefore, we must consider what the Government are doing with regard not only to Scotland but to the economy of the United Kingdom. We are going through hard times, but I have faith in what the Government are doing to regenerate the economy as a whole. We are cutting taxation. We have already cut it by £1,000 million within our first year in office. We are slowly de-escalating huge and unjustified wage claims, which more than anything else have resulted in the high unemployment and high prices. Until they are de-escalated we shall not be able to stop that high unemployment and the big price rises. The main plank in the programme for regenerating the economy is putting some sense back into industrial relations.
Those three points—the cutting of taxation, the de-escalating of huge and unjustified wage claims, and putting sense into industrial relations—are producing results, even though the Bill has not yet been passed. They are not great results yet, but the halving of S.E.T. and the reduction of corporation tax by 5 per cent. must give extra liquidity to companies in Scotland. It will be interesting to see, come September, when we have all the pension increases, the increase in the retail trade as a result of more money jingling in pockets. This will be a minor inflationary injection for Scotland. [Interruption.] It is no use the hon. Member for Kilmarnock (Mr. Ross) laughing. It is the greatest single pension rise the old-age pensioners have ever had.
The de-escalation of wage claims is succeeding. The hourly wage rate for the last six months of 1970 was rising at 8·1 per cent. a year. In the first five months of this year, the latest figures I could obtain, it is rising at 3·5 per cent. Such a cut is a good indication of our success, slow but definite, in cutting back high and unjustified wage claims.

Mr. John Smith: Mr. John Smith (Lanarkshire. North) rose—

Mr. Sproat: I will give way when I have finished this passage.
I believe that we now have fewer strikes in progress in Scotland than at any time in the past 20 years. That is a result of the Government's firm attitude over industrial relations. It is beginning to show results. They are small so far, but I believe that the effect of that attitude in regenerating the economy will grow.

Mr. John Smith: I am grateful to the hon. Gentleman for allowing me to interrupt the passage from the Conservative campaign guide to which we have been treated. Does he agree that the only discernible result of those policies for Scotland is that we have the highest rate of unemployment since we last had a Conservative Government?

Mr. Sproat: I do not agree. What I have said shows that that is not true.
I turn from the short-term prospect to the longer-term prospect, and here I want to say something about the Common Market. One hon. Gentleman said that he did not think that it should be discussed in this debate because we shall debate the subject next week. I do not agree. For Scotland's economic prospects, the Common Market is a vital element, and should be discussed today. The point raised by the hon. Member for Glasgow, Scotstoun (Mr. Small) about British Standard Time shows a basic ignorance. He thinks that just because something happens in Europe it must happen here, but, of course, it does not. We can go on abolishing things like B.S.T. for as long as we like when we are in the Common Market ; there is no need to harmonise everything. I would go on rejecting B.S.T. for as long as I was in the House, even when we were in the Common Market.
I believe that Scotland will benefit, as the economy of the United Kingdom as a whole will benefit, from our entry into the E.E.C., and that Scotland will enjoy a higher standard of living, as will the whole United Kingdom. The Common Market countries have enjoyed a higher standard over the last decade than they had before. Indeed, they have overtaken this country.
I was glad that my right hon. Friend mentioned the question of fishing. That is separate from the overall economic

development of Scotland. I am very glad that he made the reservations he did. which I entirely share.
Many firms and companies in Scotland are hanging back on their investment plans until they know for sure whether we shall go into Europe. When we know for certain, we shall see a welcome increase in investment.
My hon. Friend the Member for Galloway (Mr. Brewis) mentioned Southern Ireland and German investment. It is perhaps even more instructive to look at the level of German investment in Belgium over the past 10 years since the Common Market got going.

Mr. Donald Stewart: How does the hon. Gentleman conclude that entry into the E.E.C. will benefit Scotland, when there have been numerous occasions in the United Kingdom context when the South-East of England has had an affluent society while Scotland has not?

Mr. Sproat: It is generally accepted that when England was affluent Scotland might not be so affluent, but it was more affluent than before, and that when the United Kingdom as a whole hit hard times, Scotland hit appalling times. Whatever century the hon. Gentleman may be living in, we are irredeemably bound up with the economy of England and Wales today.
I also welcome entry into the E.E.C. on the whole question of regional policy, because I believe that the European Investment Bank would be another source of funds for further Scottish development. The Social Fund of the Community would also help retraining in Scotland, which is another important factor. I believe that not a single mandatory change in regional policy as it affects Scotland would be necessary because of entry into the Common Market. We could go on exactly as we wanted in our regional policy, or change it as the House might decide. I see the hon. Member for Western Isles (Mr. Donald Stewart) shaking his head. Does he realise that France and Italy have larger development areas, not only by geographic area but by population? We shall be able to go on with our development area policy for Scotland even if we join the Common Market. One of the main objects of the


Community is to reduce economic differences between regions. Therefore, we in Scotland need have no fear of entry but should welcome it as a great chance to expand our economy.
Therefore, when I consider the excellent investment incentive package we have, the possibilities of Oceanspan and North Sea oil, the overall strategy of growth that the Government are applying to the country as a whole, and the prospects that the Common Market opens up, I have every confidence in the economic future of Scotland.

7.50 p.m.

Mr. Dick Douglas: There were certain elements of the analysis of the hon. Member for Aberdeen, South (Mr. Sproat) which I could not share. The Secretary of State indicated that he foresaw a high level of unemployment when he came to office. I want him to look searchingly at the unemployment figures. From January to June this year, the monthly average of unemployment has been 27,000 higher than the monthly average of 1970. What are the prospects for the Scottish economy and the Scottish people in the winter of 1971–72? We should be grateful if the right hon. Gentleman could tell us that we are likely in that winter, or even in 1972, to get back to the 1970 monthly average. But we have had no such indication from the Government and unemployment in Scotland is now averaging 120,000. Can the right hon. Gentleman, in terms of post-war recorded figures, tell us of any six-monthly period when unemployment has been running at 120,000 in Scotland?
Hon. Members opposite have put a persuasive case that the growth of the Scottish economy must be closely linked with the growth of the United Kingdom economy. I am always interested in the type of economic advice given by the right hon. Gentleman's economic advisers. I wonder how much he listens to them. Professor A. D. Campbell, professor of economics at Dundee University, writing in the Investors Chronicle on 26th May in relation to a particular regional study—and I hope I am not quoting out of context—said :
There is, however, no Government commitment to the expansions considered in the

Tayside Study so that recovery in Tayside will depend, as in most other areas, on the general recovery of the U.K. economy.
What have we in prospect for that? The Chancellor of the Exchequer's budgetary forecast is not on tap. We are still awaiting the result of his survey. His budgetary strategy is a failure. There is no point in hon. Members opposite talking about the cut in corporation tax. Let them point out at this time the balance sheet of any Scottish company—or of any United Kingdom company for that matter—which shows cash flows capable of giving sustained investment in future. Company liquidity is still very tight. There is no indication that industry is willingly going to undertake purposeful investment, and that is regardless of whether we enter the E.E.C., because the Government in three tragic instances have sapped the confidence of industry. They have done so by their actions over Rolls-Royce, U.C.S. and the Mersey Docks and Harbour Board.
The right hon. Gentleman pleaded, "I was there first." He is always there first. Let him go, for instance, to the Clyde Port Authority and ask those in charge whether they could raise money on the public market just now at any rate of interest, and they will tell him that the result of the Government's action over the Mersey Docks and Harbour Board has eroded the possibilities of public concerns going to the market. That is a fact. It has nothing to do with the Labour Government but is the direct result of 13 distasteful months of Conservative Government.
We have not got growth prospects. The fires of economic growth have not been lit, and the fires of inflation have not been stilled. We have the worst of all possible worlds and the only business in which people are willing to invest is the money business. Very few people are willing to turn their money into fixed assets. That is one of the troubles with Government policy. They have eroded confidence. One can speak with a great deal of sympathy about trying to get foreign capital and foreign fixed investment into the country, but there are dangers in this and one should be alive to them. Part of the recession in the Scottish economy, although not entirely, results clearly from the fact that there has been a recession in the United States,


and the multi-national companies set up in Scotland during the last 10 years or so have found it expedient to curtail growth there.
What are the Government going to do not just to get foreign investment in Scotland but to create indigenous growth? The young people who are coming on to the labour market are highly trained and highly skilled. One of the tragedies of this summer is that a lot of highly-trained personnel will be coming on to the labour market at a time of high unemployment. We have invested considerably in the past and will do so in future in training skilled personnel. What for? To be thrown on to the scrap heap of unemployment? It is a tragedy. What do the Government propose to do about that?
There has been the erosion of regional policy as exemplified by the process of raising the level for industrial development certificates. This, too, is a tragedy. The siting of the value-added tax centre at Southend is yet another tragedy. Did the right hon. Gentleman agree to that? It was a Cabinet decision. It is not so much the number of jobs that is important, but the psychology of the decision in that the Government, when they can make a decision, choose to site a Government enterprise in an already congested area.

Mr. Gordon Campbell: The point, as explained by my right hon. Friend the Chancellor of the Exchequer, was that the Customs and Excise is already at Southend and that if the value-added tax is to be brought in in two years' time it is convenient to use the Customs and Excise people already there. But three-quarters of the personnel are going to be dispersed throughout the United Kingdom and the figure of 10,000 which some hon. Members have produced is completely out of proportion.

Mr. Douglas: The right hon. Gentleman has answered my question. He agreed to this decision and he has not taken into consideration the psychological effect.
We are already paying dearly, to the tune of £150 million, for the decision to site the third London airport at Foulness. If that is linked with a port and further industrial development in order to suit

the powerful industrial interests trying to promote that type of project, and the right hon. Gentleman acquiesces or complies with that decision, the people of Scotland will not take kindly to it.

Mr. Gordon Campbell: What I agreed to was that about three-quarters of the personnel are going to be dispersed throughout the United Kingdom.

Mr. Douglas: I do not welcome the right hon. Gentleman's interjection because I have moved on from that point. Great public companies are bringing pressure to bear and are knocking on the Government's door. The people of Scotland will not forgive the right hon. Gentleman if he acquiesces to this decision.
I take the point about the switch from investment grants to tax-based incentives. Again, I quote from the same article by one of the right hon. Gentleman's economic advisers :
The switch from investment grants to free depreciation has reduced the Region's attractions relative to areas without Development Area status ; and vast new areas, competitive with Tayside for new industry, have been given the greater advantages of S.D.A. status …".
This clearly indicates that the differentials between development areas and non-development areas have been eroded. The right hon. Gentleman should bear this important consideration in mind.
I turn to a point about a matter which is very dear to me concerning U.C.S. The Secretary of State raised this issue ; I did not intend to raise it. But I say unequivocally that the views of the S.I.B. director fell on very receptive ears on 14th October. He made recommendations to the Government concerning credits for shipowners who had ordered ships with U.C.S. I want written into the record the Answer given to me on 2nd July by the Secretary of State for Trade and Industry :
The Shipbuilding Industry Board Director discussed the position of the company with officials of my Department on 14th October. In the course of that discussion, he expressed doubts about whether the company should continue trading. No written communication passed between Mr. Mackenzie and the Department."—[OFFICIAL REPORT, 2nd July, 1971 : Vol. 820, c. 222.]
I do not want to impugn anyone's professional status, but it should be clearly pointed out that there was a distinct possibility that Mr. Mackenzie, in


evaluating the position, would be faced with a conflict of interests. In a Written Answer given to me today, the companies in which Mr. Mackenzie held directorships were set out and included among them was Yarrow and Co. Ltd. In view of this, the Department should at least have called for documentary evidence of the background in detail.
I may seek the indulgence and good grace of the House to raise this matter further, but I wish to put it on record that Mr. Mackenzie might have had a conflict of interest. I ask the Minister who winds up the debate to say whether the possibility of a conflict of interest was put to the S.I.B. director and whether he was asked to resign from the U.C.S. Board or from Yarrow and Co. Ltd. because it is passing strange that the only part of U.C.S. which we could be sure of saving was Yarrow Shipbuilders, which is wholly owned by Yarrow and Co. Ltd.

8.4 p.m.

Sir John Gilmour: One of the main points raised in this debate is whether the method of supporting industry followed by the Opposition was better than the method which my right hon. Friends are following. For the Opposition to prove their claim, they would have to show that at the end of the Labour Government's period of office, when an election was called very unexpectedly, a large inflow of jobs was being created in Scotland by the means employed by the Labour Government. I do not think that that was happening. If the jobs had been in the pipeline, they would have been coming out now. My right hon. Friend the Secretary of State is right in saying that he inherited a very difficult situation.
We have been having debates about the all-too-high level of unemployment in Scotland since about 1958. Neither party has been able to find the answer. It is a very good thing in these debates to be a bit critical, not only of the Opposition, but of ourselves, and I hope to do this in a constructive way.
One of the troubles is that when we give a big grant to an incoming industry which puts up a new factory there is immediately a flow of labour from established industries to it. There is also wage escalation, because the Government are

paying money to help pay higher wages to attract industry. In the intervening period before we go into the Common Market—and the opportunities which arise from the Common Market will certainly come, but not for some time—there is a great deal to be said for a programme for modernising and helping existing industry in Scotland. I am interested in the future and prospects for what I have. Although I should like to have enough money to buy, say, another bull, I wish to tend and foster the cattle I have. I think that the Government would be well advised to foster and improve existing industries in the period immediately ahead. This is particularly necessary because in a very short time the regional employment premium, which is bringing quite large sums into existing industries in Scotland, will be phased out.
What can Scotland cash in on in particular? We must cash in on the deep water in the west of our country and the bridge which can be created through the port on the Clyde for industrial Scotland. How can we best set about doing this? I think that the solution lies in an injection of capital into the steel industry. One of the things which I find slightly worrying about the C.B.I. report on the steel industry—and my right hon. Friend the Secretary of State said that he had been to see the steel works at Taranto—is that by joining the E.E.C. we shall be taking part in a pricing policy whereby the steel is priced at the works and the consumer, who is at a distance from the works, will have to pay for the transport. I take it that the purpose of the steel works in Italy which my right hon. Friend visited was to attract and expand steel-using industries in the area. This is what we would have to do in Scotland.
Another problem which I see arising from our entry to the Common Market is that if we greatly depend on an I.D.C. policy it is one thing, in an United Kingdom context, to refuse an I.D.C. for growth in the South or South-East, but what will be the position if, having refused it, the company says, "We will go to Brittany or Normandy"?
There are some immediate and possibly short-term steps which my right hon. Friend the Secretary of State can take to help foster existing industries. One of them concerns the whisky-producing industry which will be faced with a


challenging situation arising from our entry to the Common Market, because the price of its raw material—cereals—will increase. Another difficulty is that countries will be very much guided by what we charge when it comes to setting their own spirit duty. This would be a very appropriate time to reduce the duty on whisky, and I hope that my right hon. Friend will give this point serious consideration. [HON. MEMBERS : "Hear hear."] I am glad that there is a certain amount of support for that. I should perhaps have declared an interest before I made that statement.
The paper-making industry, which affects so much the East of Scotland, can look forward to a better future if we go into Europe but, on the other hand, it is facing serious difficulties at present. One gets the impression that some Scandinavians are trying by unfair competition to get the mills in this country out of production before our advent into the E.E.C., and we therefore need help there. Other hon. Members have mentioned the fishing industry. Here we have a prosperous industry right round the coast of Scotland which should not be neglected in the negotiations.
We must have a bit of imagination. The Highlands and Islands suffer greatly from the high cost of transport, and I see no reason why the Chancellor of the Exchequer should not reduce petrol duty on all islands. No one who lives on an island has free access to the road system of this country. An islander has to pay a heavy charge to come over on a ferry before he has access to the road system. Since the people living on islands do not get full value from the road system they should not be charged the full pertol duty. If we do this the people in the Highlands and Islands will feel that the Government have some imagination, and do not have the civil servant's "same all over the country" attitude which most Governments of the past have had.
A matter which concerns my constituency is the sugar beet factory in Cupar. This is a hardy annual which I have brought up many times. There has been a feasibility study into the possibility of someone other than the British Sugar Corporation running this factory. We know that on entry into the E.E.C., after the Commonwealth Sugar Agreement ends, 400,000 tons of sugar will either

not come in or will come in after payment of a higher duty which will adversely affect our balance of payments. This is equivalent to 200,000 acres of sugar beet grown either in Europe or elsewhere, and the farmers in Fife and the East of Scotland have agreed to support the factory if a change can be made so as to allow private enterprise to take part in this essential industry.
With higher cereal prices if we go into the Common Market there will be a greater need for a break crop in Scottish agriculture. I remember my hon. Friend the Parliamentary Secretary to the Ministry of Agriculture, saying that the price of wheat would be such that people would be growing it on the top of Ben Nevis. If this happens and there is increased cereal production the need for the growing of sugar beet will be all the greater.
I am fairly certain that our economic difficulties will not quickly be overcome. We read in the newspapers about Pan-American and T.W.A. having to merge, and the possibility of continuing the RB211 seems to be fading every day. Perhaps it is wrong to cry woe but, on the other hand, it is better to face the dangers and difficulties and be prepared for them. I suggest that something could be done in the short term between the Department of Social Security, my right hon. Friend and the Minister of Defence. I cannot believe that there are not some items of defence which normally the Exchequer says there is not enough money to buy. If we have to pay out huge sums in social security to skilled men for doing nothing, would it not be better to calculate whether, as a bridging operation until new industry is brought in, some useful equipment for the State could be procured? By doing this we should be utilising the labour and creating a useful asset.

8.14 p.m.

Mr. John Rankin: I agree largely with what the hon. Member for Fife, East (Sir J. Gilmour) said but I remind him of the need to provide movement and jobs for people. There is a continuing movement of people from the Western Islands over to the mainland. If we do not satisfy the economic and social needs of the people who live in these less attractive parts of the country, those people will


not wait, because the attractions are too few and the transport arrangements, whether by surface or by air, are in sufficient. I hope that the Secretary of State is taking note of these matters. He has heard of them already. If we are to preserve the distribution of population more equitably throughout Scotland we must provide jobs, attractions and all the other amenities of life to keep people living in the areas which tend to be depopulated.

Sir J. Gilmour: On this transport question, does not the hon. Gentleman agree that one can buy a fortnight's holiday in Majorca more cheaply than a return ticket to Stornoway?

Mr. Rankin: That is an even stronger criticism from a supporter of the Government than I as a critic of the Government have made, and I trust the right hon. Gentleman the Secretary of State will pay close attention to that.
The hon. Member for Aberdeen, South (Mr. Sproat) said that he was a supporter of entry into the Common Market. I, too, am a supporter, because I think Scotland has a better chance of economic freedom in the Common Market than she has at present. Scotland is too much under the control of the wealthier and more powerful country with which she is allied. On the flight from Glasgow to London, from the time one leaves the Lake District there is scarcely a single bit of England that is uncultivated and scarcely a big town which is not very close to another big town. So here we have a mass of people, a mass of work and a mass of wealth that Scotland cannot equal because she has not the physical backing to create that wealth. Consequently, in parts of England such as Coventry and the Midlands we have established great Scottish populations, Coventry is almost a Scottish city. Our workers have gone to that city from Scotland seeking better homes and better wages than they can get in their home country, and what is happening is that they are dissociating themselves almost completely from Scotland. Scottish communities are being established in England because Scotland has not been able to provide her own people with a sufficiently attractive livelihood.
Our Scottish business men have been seeking to break this English control—I say this without wishing to be offensive—by establishing their own business contacts with the Continent. Those business men have been in direct contact with customers in Europe and have sought to ease the situation by trying to get air services started so that the various business representatives can fly between Europe and Scotland to sell Scottish goods and promote Scottish industry in Europe. They have been doing this for quite a while. I have raised this matter on two or three occasions and have had absolutely no encouragement, because every bit of business that leaves Glasgow and Edinburgh to go into Europe in order to promote Scottish industries must go through London. Nothing can be done as between Glasgow and Western Europe without first getting the permission of London. That is one powerful reason in my view why we should support the Common Market—[Interruption.]

Mr. Deputy Speaker (Sir R. Grant-Ferris): Order.

Mr. Rankin: Mr. Deputy Speaker, I am not aware that it is an offence to give a reason for one's views. I have given only one reason.

Mr. Deputy Speaker: I am seeking to put to the House that the hon. Gentleman should be allowed to make his points in his own way.

Mr. John Robertson: On a point of order, Mr. Deputy Speaker. Surely a Member of the House is allowed to make known his reaction to a comment by one of his hon. Friends. It is surely not an offence to make that comment.

Mr. Deputy Speaker: It is perfectly correct that an hon. Member should be allowed to make his comment, but I hope that the hon. Member for Glasgow, Govan (Mr. Rankin) will not be diverted by any other comments.

Mr. Rankin: I apologise, Mr. Deputy Speaker. I accept the comment of my hon. Friend the Member for Paisley (Mr. John Robertson) in the same spirit as I hope he will accept my comments. It is because I feel that it is necessary to try to get direct Scottish connections with European countries that I and many other people favour the Common Market.


I hope that this will succeed in giving us a certain amount of liberation for which we have waited so long and which we so badly need. Every one of us, whatever our views on the Common Market, knows that Scotland has not advanced as rapidly as it should in filling up its empty spaces. We all know from our service in the Scottish Grand Committee the problems facing the Scottish economy, and this is one of the basic reasons for the continuing exodus of our young people from Scotland. We must do all we can to keep those young people in Scotland so that they may help to develop their own country and so increase the prosperity of the United Kingdom as a whole.

8.24 p.m.

Mr. Hamish Gray: I go a long way with certain comments made by the hon. Member for Glasgow, Govan (Mr. Rankin), and I hope to deal with some of them a little later in my speech.
Somewhat unusually, I disagree with some the the remarks which were made by my hon. Friend the Member for Perth and East Perthshire (Mr. MacArthur). I do not agree that the future prosperity of Scotland necessarily depends entirely on the prosperity of the United Kingdom. It is a pity that this has always been regarded as a foregone conclusion. What happens in times of prosperity is that in Scotland the prosperity is a little less marked than in other parts of the United Kingdom. Conversely, in times of depression the effects are infinitely worse in Scotland than elsewhere.
I agree with those who have suggested that the balance could be rectified if further oil strikes are made off our shores. A tremendous future lies ahead for our country if such oilfields are developed, and I hope that royalties from these finds will be more evenly distributed than has been the case in the past.
The ailments of our economy are not easily diagnosed. I do not agree with those who suggest that all our troubles emanate from the period 1964 to 1970; they go back a good deal earlier than that. However, I suggest that the previous Government's policy instead of rectifying the situation only accentuated the deficiencies.
The system of investment grants has been discussed at length and my only criticism

of grants is that so often they were given to companies which were expanding from elsewhere. Therefore, in hard times the first places to be closed down are those in the furthermost parts away from the original company, and consequently Scotland has been the sufferer.
I do not intend to deal at length with unemployment since it has been fully covered by hon. Members on both sides of the House. Since there are still many hon. Members who wish to take part in this debate, I do not want to be drawn too widely on that subject. I am sorry that the right hon. Lady the Member for Lanary (Mrs. Hart) is not present at the moment since she made one or two accusations against the Government which should be investigated. She referred to the transport system being pursued by the present Government, but omitted to point out that the transport policies pursued by the Labour Government did nothing to help the situation in Scotland. I can think of few occasions when a Bill created more disquiet in Scotland than did the Transport Bill introduced by the previous Government.
I agree with the right hon. Lady that the situation in regard to regional policies is extremely worrying. In spite of assurances given from both sides of the House, people are still gravely worried about the effect on regional policies if we join the E.E.C. There are few comments on regional policies in the White Paper. While I do not want to be distracted by the subject of the E.E.C. at this stage, many of us will want to ask questions about the regional policy when the appropriate time comes next week and in the months ahead.
Since becoming a Member of this House, I have been somewhat depressed by the perpetual attacking of each other's past policies that takes place. It does not seem to matter which department is taking part in a debate. A great deal of time is spent from both Front Benches lashing the policies of the other side. Il is purely as a means of defence that it occurs so often, and one side is as guilty as the other. But, at a time when we should be combining in the interests of Scotland to try to solve the problems of our economy, it is a pity that we spend so much time hammering one another.
I believe that the Government are trying seriously to control the cost inflation


which has hit industry in the past years. Certain hon. Gentlemen opposite would be well advised to support the Government in their efforts instead of trying to stir up matters in places outside this House. That needs to be said, and I have no hesitation in saying it.

Mr. James Sillars: Members of the Conservative Party really must stop this nonsense. The people who began the argument that wages were chasing up prices were the leaders of the Conservative Party, and they did it in page 11 of their manifesto under the heading, "Steadier Prices".

Mr. Gray: The problem of prices has been gone into fully today, and my hon. Friend the Member for Aberdeen, South (Mr. Sproat) made a very interesting comparison in figures showing how the Government already have started to get on top of the problem. We appreciate that it cannot be solved overnight—[Interruption.] The hon. Member for South Ayrshire (Mr. Sillars) is entitled to his opinion, of course.
The new policies that the Government are pursuing will take time. The Government accept that they are bound to take time. We cannot expect miracles overnight, but we are confident that these policies will succeed, As time goes on, hon. Members opposite may have a fair amount of word-chewing to do.
S.E.T. already has been halved, and it will be abolished altogether in 1973. Considerable encouragement has been given to the steel industry recently with the announcement about Ravenscraig and the close co-operation now going on between the board and the Government will be to the benefit of the industry.
The subject of Hunterston has been dealt with thoroughly. One of the disadvantages of speaking in the later stages of a debate is that much of what one wanted to say has been said already by other hon. Members. A number of hon. Members have referred to special development areas, and the announcement about increases in road programmes and housing grants will be received with delight throughout Scotland.
The problem is not as simple as that, however. Until such time as we can attract investment, whether it be foreign

investment or from within the United Kingdom, Scotland will still be up against it. I do not agree with the hon. Member for East Stirlingshire (Mr. Douglas) that this Government have damped out any hope of investment taking place in Scotland. It is fair to say that investment had been very slow for a number of years before my right hon. and hon. Friends came to office. There was a great deal of apprehension, and right hon. and hon. Gentlemen opposite must accept their share of the blame.
I believe that Scotland has a very great future. I am not despondent about it. But it requires the maximum co-operation on both sides of the House to create in Scotland the will to succeed and the knowledge that success can be ours. I hope that all parties will contribute to this in due course.

8.34 p.m.

Mr. Donald Stewart: The hon. Member for Ross and Cromarty (Mr. Gray) made one or two valuable points, although I did not agree with all of them. He brought out the fact that Scotland has not automatically come into line with improvements in the economic situation in England. We have seen many occasions of that in the past.
I was quite unable to follow the reasoning of the hon. Member for Aberdeen, South (Mr. Sproat), to whom I am grateful for giving way on one occasion. I am sorry that he did not give way to me the second time. If he had done so, I should have raised with him the point about assistance to development areas in the Common Market. Recently, I raised with the Chancellor of the Duchy of Lancaster the fact that the Brussels Commissioners had ordered the Belgian Government to desist from giving assistance to a development area in Belgium. The right hon. and learned Gentleman has confirmed in a letter to me that they cannot do it without the approval of the Brussels Commissioners. This seems ominous for Scotland, which has already suffered enough from remote control in the present set-up. We shall be much more remote if and when we enter the European Economic Community.
It is correct, as the hon. Member for Fife, East (Sir J. Gilmour) said, that it does not behove hon. Members on


this side to make the case for the prosecution against the Government. I am in general agreement with the Motion, that the Government have failed and are failing, but I do not think that the Opposition have any great grounds on which to attack them.
The right hon. Member for Kilmarnock (Mr. Ross) during his period of office as Secretary of State for Scotland, and the right hon. Member for Argyll (Mr. Noble) before him, talked about jobs in the pipeline for Scotland. Alas, as usual, it turned out not to be a pipeline taking jobs in, but a drainpipe draining jobs away. A well-known editor in the North of Scotland has said that for Scotland it is always better news tomorrow, and tomorrow never comes.
Although the Labour Government did not sent out the signal "Every man for himself", the fact is that at the end of their term in office Scotland had 82,000 jobs fewer than at the start. The Scottish unemployment figure is 45 per cent. up on the position a year ago. In passing, I point out that the current rate in England is 2·9 per cent. It is five years since Scotland has had an unemployment figure as low as that.
Both the Labour and the Conservative Governments have put forward policies which have damaged Scotland. However sensible or rational these policies may have been for England, they were disastrous for Scotland. We have on many occasions recently had to take unpleasant medicine for what was primarily an English disease. We never came in on the affluent society ; we never suffered from too much employment. We knew nothing about these problems.
I was sorry that the Secretary of State for Scotland mentioned, with approval, that we were getting various defence installations in the West of Scotland. We have far too many of these now. We have the Polaris base which Norway, although a member of N.A.T.O., refused to accept. It is time that this was taken out of Scotland, particularly from a heavily populated area. [An HON. MEMBER : "Send it to Foulness."] That is a very good idea, but I do not think that it would be accepted by Foulness. We have a rocket and gunnery range in Galloway. To regard these matters as a solution for unemployment seems a dread-

fully anti-social policy. It is almost like saying, "Let the crime wave expand so that there will be plenty of work for the police." Is that the kind of work we want in Scotland? Certainly not.
The hon. Member for Edinburgh, South (Mr. Clark Hutchison) asked some very pertinent questions. He asked : Why is Scotland suffering in this way? Is it that our people are work-shy? Do we lack the financial acumen? The hon. Gentleman answered all these questions satisfactorily, but he left out the most important answer of all : namely, that we are suffering in this way because we lack a native Government to look after Scottish interests. That is why those who have mentioned oil are wrong. Without any claim to second sight, I can tell the House that the oil will flow south and that Scotland's share will be very small indeed.
I appeal to the Government, in the short term, to adopt the five-point Toot-hill plan. This would help to get over the immediate situation. I also ask them to give the go-ahead for the Hunterston programme. Nothing would do more to restore confidence in Scotland and the Scottish economy.

8.40 p.m.

Mr. Alexander Wilson: Having listened to the debate from its commencement I can only say that speeches from the Government benches constitute nothing but a huge smokescreen, designed to divert the attention of anybody who cares to look at the words of the Motion.
I do not want, and my constituents are not keen, to listen to airy-fairy notions, however great they may turn out to be in the future, about getting oil from the North Sea. This is essentially a censure Motion on the Government who have gone into stagnation since June of last year. They have not only stagnated in their policies, but they have allowed themselves to slip back to such an extent that there has been an increase in unemployment in Scotland which is un-precented since the end of the last war. This smokescreen is no longer effective against the people of Scotland, as results in national and local elections have shown, and will continue to show until we get rid of this Tory Government.
In my constituency a fear is developing about something that I warned would happen when Rolls-Royce collapsed. There is fear about huge increases in the unemployment rate. When I refer to unemployment I am talking, not about figures, but about people. I am talking about men, women and children who have the right to work and the right to live in some dignity.
In Hamilton, in my constituency, in one year the male unemployment figure has risen to 1,290. In Blantyre it is 491, and in Larkhall it is 410. The same sort of picture is being created by the Government in other areas. The figures are the result of the Rolls-Royce collapse, and yet the Secretary of State this morning blandly announced an extra £8 million for road building.
Will the right hon. Gentleman tell the Rolls-Royce workers that this great public works programme is available to them? These are men with skills that have been gained over a lifetime of service to this country. In Hamilton there is 37 per cent. unemployment among skilled workers. In Blantyre the figure is 33 per cent., while in Larkhall it is 44 per cent. The figures do not lie. The figure for the long-term unemployed has increased in this short period of 12 months to such an extent that it is now 23 per cent. in Hamilton, 24 per cent. in Blantyre, and 20 per cent. in Larkhall.
Of course this censure Motion is essential. When the Government were elected last June they were supposed to be ready to rejuvenate the economy. They were supposed to be ready to cut unemployment at a stroke. They were supposed to be ready to cut prices at a stroke. Of course the Government should stand condemned, and any hon. Gentlemen opposite who supports the Amendment shows very little feeling for the people about whom we are talking, the unemployed. They find themselves unemployed, not through any fault of their own, but because of the sheer apathy of a bad Government.
I listened, in the Secretary of State's opening speech, for some expression of compassion for the people, but failed to find it. In my constituency in particular, the picture now developing can be compared with the 1930s. That picture shows

a soulless Government, who are deliberately legislating to show direct profit to their ever-narrowing circle of friends.
They are legislating for insecurity among the people who made the wealth of this country, but who, alas, have never had the opportunity to share in that wealth. The past 12 months have shown a decline in the growth of investment. In Lanarkshire alone we talked about £4 million or £5 million worth of investment. Only £6 million of this sum came from Scottish industrialists. The remainder came from overseas. Industrial development certificates are almost forgotten by industrialists. There is stagnation in the economy ; there is a feeling of despair among the workpeople, a hopelessness at not being able to obtain employment. It is important that we should understand the feelings of those people.
In about six or seven days' time most of the workpeople in my constituency will be on holiday. I wonder if anyone on the Government Front Bench has ever been in the position of having to explain to his children that there would be no holiday for them. How is a child told that there will be no holiday? How does a mother explain to her children that they cannot have the little treats to which a child is normally entitled? How does a father explain that he cannot provide for his own family, through no fault of his own? The biggest blow to working men and women is deliberate legislation by which they lose their dignity If there is one thing that we on this side of the House will defend with everything we have it is our dignity, our right to work and provide for our families. The Government stand condemned in the words of the Motion. Every vote against the Motion at ten o'clock tonight will be reversed the first opportunity the Scottish people have, the first opportunity the English people have and the first opportunity the Welsh people have. We shall return a Labour Government which will believe in people and not profit.

8.50 p.m.

Mr. W. H. K. Baker: In a debate of this type one naturally likes to refer to conditions in one's own constituency, and this has been so today. I


should like to refer to the three main industries in my constituency, fishing, agriculture, and, a notable industry, whisky.
The country faces the prospect of going into the Common Market quite shortly. The farmers are content. Whether hill farmers or lowland farmers, there is a big opportunity for them, and we have been assured by the Government—and this is in the White Paper—that conditions for hill farmers will certainly be protected, and that is a cause for great satisfaction.
But question marks hang over the distilling industry. There are more distillers in my constituency per acre than in any other constituency in the United Kingdom. The distillers have many doubts about the possible adverse effect of V.A.T. In recent years there has been an upsurge in distilling, with vast exports of whisky to the United States of America. Without that valuable market the distillers would be in bad trouble. I hope that tonight my right hon. Friend will make some comments on the application of V.A.T. to whisky, or at least let me know when that information is available.
The third main industry, fishing, has been doing pretty well of late because of the action of the Conservative Government in 1964 when it extended the fishing limits. I refer to the inshore industry. It is largely due to the economic measures by the previous Conservative Government that this happy state of affairs has come about.
But fishermen are worried about the future. Where there is a fishing industry there are ancillary industries, such as boat building, and for various reasons, not least the imminent application of Common Market rules and regulations, there is anxiety about the future. Unhappily, the result is that order books in the four boatyards in my constituency are thinly occupied, if order books can be thinly occupied. I hope that within the next two or three months we shall be able to get satisfactory negotiations in Brussels so that the future of this immensely important industry is assured, because until we have stability in the industry, we shall have uncertainty in the boatyards and in the industry itself.
In a supplementary question. I suggested to my right hon. Friend the Foreign Secretary yesterday that the Government

should reconvene the 1964 Fisheries Convention, together with Norway, which was not a signatory. If we could get the Convention reconvened, away from the Brussels negotiating table and outside the atmosphere of the present negotiations, it might be possible to obtain a solution which would be equitable to all United Kingdom fishermen, and not least to the inshore industry. There is uncertainty at the moment and the sooner we can get stability in this respect the better.
The economic situation in my constituency, because things are going well in the fishing industry and agriculture, is not too bad. In other words, the rate of unemployment is not desperately high. I hope, however, that there will be an improvement from the fishing point of view so that the crews will be forthcoming We will then be able to continue to have a prosperous fishing industry.

8.57 p.m.

Mr. John Robertson: Today I heard the most dreary, dull and irrelevant speech that it has ever been my misfortune to hear from a Secretary of State for Scotland. Faced with a serious crisis of unemployment, short-time working and redundancy—in other words, a crisis of confidence right across industry in Scotland—the right hon. Gentleman stood at the Dispatch Box with a silly grin on his face and tried to assure us that everything would be all right once we were in the E.E.C.
I do not know what that has to do with the immediate problems that we in Scotland face or how they will be solved quickly. I want to hear about the Scottish steel industry and shipbuilding north of the Border. Six months ago we were being told all sorts of things about industry being attracted to Scotland. Where are these expanding industries? At present we see electronics and computer firms closing down. Where are the industries that were to take us into the space-age?
The Secretary of State said that he deplored the high rate of unemployment. One might be forgiven for believing that he was trying to kid us. Either the right hon. Gentleman who is a Minister of Cabinet rank is not privy to the decisions of this Government—that he knows nothing about them and is not consulted—or he disbelieves the briefs that are put in his hands. I believe it is the


former. I do not think the Secretary of State for Scotland counts any more. I have concluded that he is not listened to and that the case for Scotland is not heard where the decisions are made.
The logic is—and hon. Members who are arguing in favour of the E.E.C. should heed this—that Scotland must have its own Parliament. If things continue as they are the Scottish people will make this demand because it will seem the only solution. A lot of monkeying about with regional policies will not solve anything. Hon. Members on both sides must beware, in any event, about using the word "region" to describe this nation that is Scotland. How can one argue on behalf of the Scottish economy and in the same breath talk about a regional policy? The two are contradictory.
I wanted to hear about the steel industry. I wonder if the right hon. Gentleman the Secretary of State has been to Scotland to inquire about it. We do not know from his speech today. But we know that he has been to Southern Italy, as a great many of us have, on what my hon. Friend the Member for Glasgow, Scotstoun (Mr. Small) calls the gravy train, taking free rides, free drinks and free eats, to see this marvel of the Common Market, the steel works, away in a desert, and enjoying it very well. With the sun shining and with time off, that is lovely.
I wonder how many right hon. and hon. Gentlemen opposite took the trouble of not only looking at the steel works but going to Brindisi and having a look at some of the slums and seeing the low standard of living. It is shameful to see the dreadfully shocking condition of the people in that area. This single steel works is put up as the salvor of all the people in southern Italy. We all know that it is not. They live in shameful poverty that is a disgrace to any nation and to Europe. Is that what the right hon. Gentleman offers as a solution to Scotland's problems? He says, "We shall be all right, boys, if we join the Common Market. American firms are running about looking for a place to build a factory. They will come to Scotland. "One wonders, why not Southern Italy, where they have built the steel works? Why build in Scotland

when they have the steel works in Italy? They cannot get anyone else to go near the steel works in Italy. Perhaps they melt the products down and re-roll them. It is a wonderful prospect. We suggested the solution to the problem in Scotland some time ago. One could build the ships at John Brown's, break them up at Gare Loch and start building again at John Browns. That is the kind of solution being presented by the right hon. Gentleman.
For goodness sake, let us get down to an appraisal of the problem. The hon. Member for Edinburgh, South (Mr. Clark Hutchison) tells us how he has wondered over the years why it was that this intractable problem we have all tried to solve for so long has never been capable of solution. It has to do with the centre of Government, or, at least, with the modern phenomenon, which is true of all countries, that once one builds up very large conurbations of people and industry, of their own free will and their dynamic, they seem to keep growing and to draw in people and industry from the peripheries. That is true of this country, of America and of the Continent. This has happened within Scotland and is happening with Scotland in relation to London and the rest of Great Britain. The population of Ireland, North and South, has been sucked in, as has that of the North and the South-West of England and that of Scotland.
But if we join the Common Market a new magnet will be created, a new concentration of industry and population, and the process will begin again. Not only will it be difficult to deal with Scotland's problems in relation to the rest of the United Kingdom, but, if we are a member of the E.E.C. it will be infinitely more difficult to deal with Scotland's problems in relation to the concentration of population and industry in the Paris-Milan complex.
It is not a problem that we shall attract American capital and we can go into Europe and sell our goods. Has it ever struck anyone that this means that the industrialists from Europe can sell goods in Scotland? So often we have been told that they are better at it than we are. What chance do we stand then?
Give us a solution to the problems of unemployment in Scotland, and not a lot of excuses that my right hon. Friend the


Member for Kilmarnock (Mr. Ross) is responsible for all the ills and that the Government have only had a year to cure them. What a dreadful thing it is for the Minister to come to the Dispatch Box to say that.
I hope that the Minister for Trade will have a little more cheering news to give us. He should at least try to convince us that he knows what he is talking about.

Mr. Speaker: It was at 22 minutes to six that back bench Members first had a chance of joining in the debate. Since then, in just under 3½ hours we have had 18 back bench speeches, an average of under 12 minutes each. I thank hon. Members very much indeed for their cooperation.

9.5 p.m.

Dr. J. Dickson Mabon: I think that we would wish to congratulate you, Mr. Speaker, on the way in which you have regulated our proceedings.
This has been a very useful debate. As Scots we can congratulate ourselves on having £25 million more than we had when we started the debate. If we had not had the debate perhaps the programme would not have been announced. Today we had a short debate in the Scottish Grand Committee when more work was announced, adding up to £33 million. Not bad for an Opposition in one day. Undoubtedly, without pressure of this kind on the irresponsible Government that we have we would get nothing at all.
I must congratulate Mr. Innis Macbeath of The Times. What prescience!. He told us several days ago that the Government were about to announce programmes of, not £33 million, but £100 million, but that was for the whole country, and the Scots would get one-third. He was right. Mr. Macbeath said also that the estimate of jobs that might be expected from that would be about 16,000.
It is in that context that we are discussing what the Government have announced, which is part of their defence against this Motion of censure, because that is what we are debating. The Government have tabled an Amendment which says, "This is not fair. We have done two great things. We have set up

the S.D.A. and we have given other strong regional incentives since we came to power. So you cannot vote against us because of these two things."
If ever there were an action which proved the Motion of censure, it is the Government's concession of a £33 million injection into the economy. It is a self-confession that all is not well. The Government know that they are in very great trouble. So, despite the Amendment, the announcement of a substantial public works programme has had to be made. We do not know how substantial it is because Conservative Governments have bad habits of losing the way with these programmes. So we must all monitor the Government and ensure that this programme comes into full reality and that it is a valid programme.
At best the programme will give us 16,000 jobs or so. At the moment the figure of unemployment is 37,000 higher than it was last year. So no question arises that this is the solution and that the Opposition should withdraw the Motion of censure. It is not good enough.
Therefore, we have to carry on with the debate and look at the Amendment. The Amendment seeks to defend the Government's position by maintaining two propositions that one can identify—first, the S.D.A. and, second, the other regional incentives. In a few days, by the way, we shall have the July figures, as my right hon. Friend the Member for Kilmarnock (Mr. Ross) said. Maybe the figure of unemployed will not be 37,000 more ; may be it will be even more. I hope not, but one must measure that against the 16,000 jobs which this £33 million programme means.
I wonder how many of the 7,885 carpenters, builders, joiners, and so on, out of work since the Conservatives were elected will get some share of these jobs. I wonder how many of the 13,000 unemployed in the civil engineering construction industry—one-sixth of the entire labour force—will scramble for these 16,000 jobs.
It is not good enough to be satisfied with this. The hon. Member for Aberdeenshire, East (Mr. Wolrige-Gordon) said that it was a palliative. The hon. Gentleman is right on the ball there. That is all that it is—a palliative to deal with


a situation symptomatically—not radically, not fundamentally, but symptomatically. It is not adequate to the needs.
Tonight the right hon. Member for Argyll (Mr. Noble), whom we welcome once again to our debates, returns to the scenes of his old crimes. We remember him very well when he was Secretary of State for Scotland. On 26th October, 1962 the right hon. Gentleman said this at Strachur :
I do not see the problems of Scotland being settled in a couple of months, but during the next year or so.
The right hon. Gentleman was right. Not from that right hon. Gentleman any of the overnight nonsense that we get from the present Secretary of State. After all, a night to him is not even 13 months. All nights are long for the Tory Party. Perhaps it has something to do with British Standard Time. I do not know. But the right hon. Member for Argyll was right. He took up office in 1962, he made that statement at Strachur, and by October, 1963, he was presiding over a Scotland with 100,000 unemployed. Then, with that panache which we all associate with him, with his yellow silk waitcoat, striding over Scotland—

The Minister of Trade (Mr. Michael Noble): The Minister of Trade (Mr. Michael Noble) indicated dissent.

Dr. Mabon: I correct that then—he announced his White Paper for Central Scotland. There was no mention of the Highland, of the North-East or Tayside. He was very much like the present Secretary of State who, in two major economic debates, in February and today, never mentioned the Highlands once. That programme for Scotland in 1963 was about Central Scotland, not about North.
Now, the right hon. Member for Argyll comes on the scene to defend the Amendment. He has to defend the success of the special development area. That is what we are told—that it has been a great success. In fact, 20 men in that area are chasing every Clydeside vacancy. That is the proportion of men out of work and trying to find work. We have never had its like since the war. My constituents, who have long memories of unemployment, tell me that they cannot recall such a time, unless they go back

to 1935, 1936 and 1937. It is as bad as that.
Some hon. Members have complained that their constituencies are outside the S.D.A. My right hon. Friend the Member for Kilmarnock talked about Irvine, Ayr and so on. I say this is consolation to those who are outside the S.D.A. and who feel out in the cold : it is freezing inside the S.D.A. There is no need to be jealous. Nothing is happening. Industry is not on the move. That is why the S.D.A. is not working. In itself, the S.D.A. is a good concept, but it is not working because industry is not on the move. However one may try to frame regional incentives, as they are called—or national incentives, to take the point made by my hon. Friend the Member for Paisley (Mr. John Robertson)—and however one may describe them, they do not work under any Government, with any system, unless there is growth in the economy as a whole. Whether it be the economy of a country or the economy of a continent, it still turns basically on the question of growth, and that is where the Government have failed.
I am helping the right hon. Member for Argyll. He must defend the success of the S.D.A., and he will, no doubt, tell us of the upturn in the I.D.C. figures. The Secretary of State almost pre-empted the argument by saying that one cannot judge on six months. He is right, but that is the point at which poor Argyll has been asked to defend the Government's performance tonight. [Interruption.] Yes, poor Argyll, certainly, for I should not like to have to defend such an impossible case.

Mr. Gordon Campbell: I must remind the hon. Gentleman that the S.D.A. has been in existence for only four months. He talks about six months.

Dr. Mabon: But the right hon. Gentleman was most anxious to impress upon us that there was an upturn. The number of industrial development certificates, he said, was showing it. He has to produce some evidence to the credit of the Government to show that their policies are working.
One hon. Member said that a Budget is helping. It takes a while to work its way through, we were told, I think, by the hon. Member for Aberdeen, South


(Mr. Sproat). Which budget is he talking about?—yesterday's budget, today's budget or tomorrow's budget? Is it October's Budget, yesterday's Budget, which we had some talk about earlier today? Is it today's Budget, the one which we have just voted on, or is it the budget which we shall hear about shortly when the Chancellor finishes the July review?
In the October Budget, we had a housing cut of £10 million, rising perhaps to £20 million. We shall hear about that tomorrow. We were also told in the October Budget that quite a substantial amount of money—nearly £60 million—for various activities in industry was to be struck out from the Government's programme. We now learn from the announcement today that some of the housing cuts of the October Budget are cancelled. After all that chopping and changing we are back where we started, except that the Labour Government are out of office and the unemployment figures are substantially higher. The same programmes are adopted at the last minute, but they cannot have the same effect because it takes time for these changes to make their way through the economy.
A number of hon. Members referred to the treatment of U.C.S. I represent a constituency which has a shipbuilding group of enormous reputation and great success. There is no question about its viability. It has a first-class labour force, and there is no doubt about its management, which is very sound and aggressive. It is building one of the largest yards in the United Kingdom, and it has a tremendous future. We are very sad about the position of Upper Clyde, and take no joy in it at all. The men made redundant will shortly be coming down for the jobs that my men have, so there is an economic threat as a result. The Government have done an incredible amount of damage to the name of Scotland and the name of the Clyde.

Mr. MacArthur: No.

Dr. Mabon: Yes. When my managers and men go abroad to get orders they are not asked, "Are you from the Upper Clyde or the Lower Clyde?" People overseas know only about the Clyde. I am telling the Government to stop knocking them, and the hon. Gentleman should

do so as well. I will come to the Secretary of State's involvement in a moment. The knocking must stop, and U.C.S. must be taken out of its present predicament. It must be put back into solvency and activity without further damage to the name of Clydeside or Scotland. The whole U.C.S. affair has been extremely badly handled from the point of view of our country, our industry and reputation.
As a matter of personal honour, the Secretary of State has an obligation to answer this question and not dodge it : did he or did he not see the so-called Ridley Plan? If he did not—and I suspect that he did not—he should say so.

Mr. Campbell: I have already said so in answer to a question. The hon. Gentleman must be deaf or blind. According to the Press, it came out when we were in Opposition—it was produced by my hon. Friend, if he produced it, long before we came to Government, and as far as I know I have never seen it.

Dr. Mabon: Now we have it clearly at last. The right hon. Gentleman revels in all his plans. For example, when in Opposition he could say that the Conservatives would have not investment grants but investment allowances. He admitted today that when they came to power they abolished investment grants without examining our report and seeing what the officials thought. [Interruption.] This is in HANSARD ; I ask the House to look at HANSARD tomorrow. The fact is that he did abolish investment grants. All the evidence from the Continent, from those countries which employ regional development instruments, shows that they prefer grants to allowances. Again, I appeal to HANSARD. I ask hon. Members to look at the Prime Minister's answer today when, pressed on whether he would accept grants rather than allowances, he said that in certain circumstances he might. The right hon. Gentleman was privy to a plan about allowances and grants. Is he now telling us that he was not privy to the Ridley Plan?—[An HON. MEMBER : "He is too unimportant."]—Maybe he is. The right hon. Gentleman must make up his mind. Either he was involved or he was not. Whether or not the Ridley Plan was an article of policy by the Conservative Opposition equal to that of investment allowances and grants, it has had the same effect as if it were


an article of policy. When we read the plan we see that everything has happened precisely as it said it would—what the Conservatives were to do in office, how they were to achieve it, the stages by which it was to be achieved, how various parts were to be broken off and how the labour force was to be rationalised. It is all there in black and white. The right hon. Gentleman does not have to go to the crystal. It is in the book. It is perfectly clear.
We are still in the middle of the U.C.S. crisis. As one who has recently been in the United States and has discussed the matter with members of Congress, I can assure the Government that we are facing a tough proposition on the question of the RB211 engine and the future of Rolls-Royce in Scotland and in Britain as a whole. Where are the 16,000 jobs announced today when one considers the position in Scotland and what the demands are?

Mr. MacArthur: Would the hon. Gentleman recall some significant words used by the right hon. Member for Bristol, South-East (Mr. Benn) in evidence about U.C.S. to the Select Committee on Scottish Affairs in 1969? He said :
My own view is that if we had at any stage even now said 'We will give you whatever you need' we should have deferred the vital decisions that had to be taken by the company to staunch the losses and we should have begun a permanent subsidy of a company that would then ultimately have collapsed in conditions of great tragedy for those involved, at the expense meanwhile of the viability of other shipbuilding groups.
Will the hon. Gentleman read that and think again?

Dr. Mabon: If the hon. Gentleman had attended our debates and listened to my right hon. Friend the Member for Bristol, South-East (Mr. Benn), he would know that my right hon. Friend answered that and has done so time and again.

Mr. MacArthur: I was here.

Dr. Mabon: Then the hon. Gentleman should have listened. Again I appeal to HANSARD. Three times I have appealed to HANSARD and I hope they are listening. The record will be right and the hon. Gentleman will see that these things were said.
The right hon. Gentleman and his colleagues cannot escape the fact that, however large the problem was, their handling of it has been disastrous to the name of Scotland and the name of the Clyde and they have got now to make amends. I want to suggest a number of things that should be done in the Government's new frame of mind in trying to salvage a very difficult situation.
First, they should stimulate the economy. I hope that that will come in the third budget this year. So much for management by business men ! We have had three Budgets in one year. Secondly, I hope, in the light of what the Prime Minister said today, and with all the evidence before our eyes in our own constituencies and among the business men we talk to, that the restoration of investment grants will be recognised as an absolute necessity. The third need is to look at the housing programme, which has fallen by 14 per cent. It should be increased dramatically. House improvement grants are no substitute. We should get back to the 44,000 figure we were achieving in our final years of office.
Fourthly, the training centres are not being properly recruited and filled. A big effort should be made to get the men who are unemployed into the centres to get new skills. But, of course, let us match those skills with jobs. That brings us back to the fundamental point, and my fifth suggestion is that it is high time to initiate better training for management in Scotland, which is not of the best. We should seek to extend, in Scotland at least, if not in the whole of the United Kingdom, the kind of plan which my right hon. Friend the Member for Kilmarnock (Mr. Ross) worked so well with my right hon. Friend the Member for Grimsby (Mr. Crosland), when they managed a pilot scheme for better training of management, some years ago. It was a good scheme which was fully taken up, and many people profited by it.
This is the kind of activity in which the Government should be indulging as well as introducing a public works programme dealing with water, sewerage and other things. Better management is as important as better labour relations and investment in infrastructure and work. It is an aspect that we tend to forget.
My sixth point concerns something which we in the last Government considered but never firmly decided upon. The right hon. Gentleman may have a tough time with his colleagues over it. It is the question of rehousing industry in Scotland. Most of Scottish industry operates in Victorian premises which are hopelessly out of date. This does not give Scottish industry a decent start against competitors. I think that the rehousing of Scottish industry by the State is something which must be taken on reasonably soon. We could do this if we were willing to use Scottish Industrial Estates and the corporations for the job instead of just concentrating on the housing of new industry.
Someone said in the debate that one of the defects of the S.D.A. policy is the absurdity of the so-called 30-mile limit. I have four instances of it in my constituency and the surrounding area. People cannot move from one point to another because they are within the 30-mile radius, and yet they could create employment or better conditions for the workers which could lead to more employment. These administrative shackles should be cut away.

The Under-Secretary of State for Development, Scottish Office (Mr. George Younger): I wish to correct something which the hon. Gentleman inadvertently said or an impression he gave unintentionally. No doubt there are some factory premises in Scotland which are out of date, but I am sure that the hon. Gentleman would not wish it to be thought that all of them were out of date. There are some very fine and modern factory facilities in Scotland, and I hope that the hon. Gentleman will confirm that.

Dr. Mabon: The trouble with being critical and honest is that one is misrepresented, unintentionally. If half the premises in Scotland are Victorian, the other half must be good premises. The figure has been given to me in confidence by someone who should know. I am sorry that I am being so constructive, because obviously it does not appeal to hon. Members opposite.
My seventh point is this : the Government should realise that Hunterston and its potentiality represents the greatest single chance which Scotland has of being a trading bridge between Europe and America. According to the Economist

last week, Krupps has made a survey of the potentiality of this site for a steel plant able to load on to large ore vessels steel which could account for as much as 80 per cent. of the plant's production. I would prefer the British Steel Corporation to do this job rather than Krupps. That is not unreasonable. But whoever does it there is no doubt that it would be a new focus of industry in Scotland. It would be a steel works able to supply our friends in Europe and America and to form the basis for the consumption of larger quantities of steel in Scotland. This is the greatest single development which the Government could authorise this year or in any year in the next five.

Mr. Alexander Wilson: Apart from resigning.

Dr. Mabon: There is a better chance of getting a steel mill than of getting this lot to resign.
I take issue on the question of Clyde-port. It cannot develop without the steel works being a focus of activity. To go into the economics of building a large iron ore port such as Clydeport without a steel works is foolish. It is not my opinion which counts, but the opinion of those who would sponsor it. I do not visualise Clydeport asking for this money unless it is clear that the Government intend to build this large steel works in Scotland.
In the absence of a national ports authority and nationalisation of the ports, let us face this fact : it is far better for the State directly to invest in Clydeport than to seek to saddle it with loans in trying to build up a great port at Hunterston. Let us have some ambitious thoughts about this section of Scotland which offers the same opportunity as was offered in Victorian times when Central Scotland became the cradle of the industrial revolution in our part of the United Kingdom.
That is the kind of positive programme which the Government should be adopting. They are doing none of these things. They have failed in their objectives in the last 15 months. While we may know the song of distress, the extent of the Government's failure is eloquently put in the Conservative Party's manifesto on Scotland. The opening paragraph says :
Scotland will get moving again. No part of Britain has more to gain from Tory policies ".


If ever a Motion of censure were carried in a Tory manifesto, it is carried in this one.

9.30 p.m.

The Minister for Trade (Mr. Michael Noble): It is like old times to come back to the Box at the end of a Scottish debate, and I am grateful to the right hon. Member for Kilmarnock (Mr. Ross) and to the hon. Member for Greenock (Dr. Dickson Mabon) for welcoming me back again. The hon. Member for Greenock said that this was to some extent a self-confession that all is not well, and every hon. Member representing a Scottish constituency on either side of the House feels that it is hard because the situation today in Scotland is deplorable. I am sorry that certain hon. Members said that my right hon. Friend made no reference to the human suffering caused by unemployment at this level. But my right hon. Friend did. He said it was regrettable not only from the human aspect but because of the tremendous waste of resources that unemployment brought about.
I was interested in a number of constructive points made by the hon. Member for Greenock which need much careful thought. I am delighted that he now supports, as we have for a long time, the training of people in new skills and in management. He will remember that not so long ago the main attack from the Scottish Council on his own Government's policies was that they were not considering this problem.

Dr. Dickson Mabon: That is not true.

Mr. Noble: I cannot remind the hon. Gentleman to look up HANSARD, but if he reads the Scottish Council reports of about three years ago he will find that was the main charge. The hon. Gentleman asked me to defend the policy of S.D.A.s. His Government invented S.D.A.s. and, because this was a convenient method of getting help quickly, we are following the course that his Government thought was wise.
Unlike our experience in some earlier debates, we have heard a great many constructive and useful speeches, and my right hon. Friend will be thinking seriously about a number of points. He has a considerable problem, which we all

realise, of trying to get the situation in Scotland back again on to a good footing It was lamentable that the hon. Member for Hamilton (Mr. Alexander Wilson) should revert to the worst tradition of the old Scottish debates. It was rather remarkable that this speech should have come from Hamilton where, if he has a reasonably long memory, the hon. Gentleman will remember his right hon. Friend was totally rejected in a by-election not very long ago.

Mr. Alexander Wilson: Mr. Alexander Wilson rose—

Mr. Noble: There are very serious problems, and we all know them, but his speech did not contain a single constructive idea from beginning to end. This is what is often wrong about speeches which are made in these debates—and I have attended many of them—

Dr. Miller: It was a good speech.

Mr. Noble: Every one is entitled to his opinion. It is a free House—[Laughter.]—and we are all entitled to express our opinions and stand by them, but we are equally entitled to deplore rubbish when it is spoken from either side.
The most depressing aspect of the speech of the right hon. Member for Kilmarnock is that he did not for one single second—

Mr. Alexander Wilson: Mr. Alexander Wilson rose—

Mr. Noble: I am sorry—

Mr. William Hamilton: Mr. William Hamilton rose—

Mr. Speaker: Order.

Dr. Miller: It is a free House—give him a drink.

Mr. Speaker: It is a free House, but it is tied to certain rules of order. The right hon. Gentleman has not given way.

Mr. Norman Buchan: If an hon. Member is attacked, is he not entitled to reply?

Mr. Noble: The hon. Gentleman well knows that in our debates one is perfectly entitled to say what one thinks about a speech. It has been said often enough about me and people would never give way. The right hon. Member for Kilmarnock never gave way once in four years.

Mr. Ross: That is not true.

Mr. Noble: Unfortunately it is true, and I would ask the right hon. Gentleman to look at HANSARD.
The depressing aspect of the right hon. Gentleman's speech was that he did not for one moment contemplate that anything he had done in the six years that he was Secretary of State could possibly have contributed to the problems which we inherited. The situation today is extremely grave, and I do not hesitate to say so, but it is a fact that in 1966, when the right hon. Gentleman's plans could reasonably have been expected to come to fruition and when the right hon. Gentleman was in his own way leading forward the position of Scotland, unemployment was 55,000.

Mr. Douglas: It is now 120,000.

Mr. Noble: In July 1970, the unemployment figure was 93,400. We all know that this was not only the situation in Scotland but that it affected the United Kingdom as a whole. When we came into office in the summer of last year there were some particularly worrying features in Scotland, and everybody who had to study the figures could see them.
First, we could see that Scotland was securing a lower proportion of the new industrial projects than it had in the past. During the period from mid-1966 to mid-1970, total employment in Scotland had declined by some 65,000 jobs. These figures exclude the construction industry because the employment figure for that industry, after S.E.T., became a little more difficult to analyse because so many people became self-employed.
The figure was bad enough, but the total includes a loss of 20,000 jobs in the manufacturing industry at a time when employment in the manufacturing sectors of Wales and in the northern region increased by over 40,000 jobs. Therefore, I find it a little difficult to see from what basis of success in his own period of office the former Secretary of State seeks to say that it is all our fault and that he was doing a splendid job. He was losing manufacturing jobs in Scotland at the same time as his colleagues in Wales and the northern region were gaining them fast. This was

a very difficult and worrying problem to put right.
Secondly, there was the problem of the particularly heavy incidence of unemployment in West Central Scotland. For a considerable time now half of Scotland's unemployment has been on Clydeside and in the surrounding areas of West Central Scotland. The right hon. Lady, the Member for Lanark (Mrs. Hart) and the right hon. Member for Kilmarnock indignantly demanded that the Government had done nothing about rising unemployment in Scotland. I wonder why the Labour Party did not stop the rising tide when they were in office. The signs were clearly there and the picture was one of steadily increasing unemployment.
I would not mind if only they said, "This was a problem which we were trying to tackle and which we found exceedingly difficult. We tried these methods, some worked and some did not". But not at all. They try to pretend that in some curious way the whole problem has developed suddenly since June of last year. I find that quite nauseating. Certainly the position has worsened. However, something which rapidly is going downhill takes even longer to put right than the sort of situation that the right hon. Gentleman inherited, which was on a steeply upward graph. It is because the policies of the previous Administration had failed totally to deal with the situation that it was right for this Government to see whether new policies should not be introduced which would have a good deal better effect.
My right hon. Friend made clear today the reasons why the new policies were adopted, what they were, and how he expected them to develop once we had the economy as a whole going as well.
I agree with the hon. Member for Greenock that it does not matter how good the incentives are or how big the S.D.A.s are, unless the economy can be got on the move upwards, there is no chance of attracting industry to Scotland and little chance of getting the industry which is in Scotland working at anywhere near its full potential.
To my mind, there are two separate but very important points. We have to get the economy of Britain moving. Once


that happens, we have to have the right parcel of incentives in order to attract our share or more than our share—

Mr. Douglas: I am intrigued by the right hon. Gentleman's analysis. Will he concede that what we really need is a third Budget? Following it, we might get some other incentives to see whether the third Budget is in harmony with the new incentives, because clearly the present incentives are in harmony neither with the Government's budgetary policy nor with the anticipated growth in the United Kingdom economy.

Mr. Noble: When I sat on that side of the House, we were becoming perfectly used to three or four Budgets a year. However, I agree that to deal with special problems from time to time special Measures have to be taken and not confined just to a single time in the year, in order to put the required remedies into operation.
The difficulty in which the right hon. Gentleman and many of his hon. Friends find themselves is that it is not sufficient simply to say that we want investment in Scotland irrespective of what it may be. In the past four or five years, we have seen a very great deal of money going into Scotland through investment grants, but the number of jobs has dropped steadily.

Mr. Ross: Mr. Ross rose—

Mr. Noble: I should love to allow the right hon. Gentleman to intervene. However, as he would never give way to me, I think that it would be terribly good for his soul, for once, if an hon. Member refused to give way to him.

Mr. Ross: Mr. Ross rose—

Mr. Noble: No, I shall not give way.

Mr. Ross: It is quite untrue to say that I never gave way—

Mr. Noble: I think that he did on one occasion. The right hon. Gentleman knows that generally I am extremely courteous. However, as he refused to give way to me in debate after debate, just once in his life it would be very good for him if an hon. Member did not give way to him.
I now turn to the various points which were made in the debate to see whether I can either encourage or discourage some of the suggestions which were put forward.

Dr. Dickson Mabon: Dr. Dickson Mabon rose—

Mr. Noble: I think I heard something which passed between the hon. Gentleman and his right hon. Friend. There was a little collusion going on.

Dr. Mabon: Will the right hon. Gentleman give way?

Mr. Noble: I will give way to the hon. Gentleman, but not at this moment because I know that he is doing a little fiddle with his right hon. Friend.
The right hon. Member for Kilmarnock asked why the office dealing with V.A.T. was to be in Southend. The answer, which I suspect he already knows, is perfectly simple. The Customs and Excise duties office in Southend will be used in the beginning stages for dealing with V.A.T. About three-quarters of the jobs which will be created—I think that is the right word—for V.A.T. will be scattered throughout the rest of the country. It is not, as it were, a post office which is being set up in Southend. The staff there will be used, but the great bulk of the extra jobs will be scattered throughout the rest of the country.
My right hon. Friend was asked and spoke about I.D.C.s, and the hon. Member for Greenock also mentioned them. My right hon. Friend very properly said that the signs of improvement were slight, but that it is always dangerous to try to base firm calculations on a short period. However, I can give some figures to the House. In the period January—June, 1970, 79 I.D.C.s were issued ; in the same period in 1971 there were 88. The area covered was 3·8 million sq. ft. in 1970 and 4·2 million sq. ft. in 1971. For West Central Scotland, under the S.D.A. policy, one can take only the March—June figures. In March—June, 1970, the number of I.D.C.s issued for that part of Scotland was 17 and in March—June, 1971, the number was 27. I do not ask hon. Members to cheer desperately about that, because I know that they will not. However, as I was asked for the figures, I have given them.
The right hon. Member for Lanark asked what would be the position of


I.D.C.s if we went into the European Economic Community.

Mrs. Hart: No, I did not.

Mr. Noble: I shall check HANSARD tomorrow, but I wrote it down as the right hon. Lady said it.

Mrs. Hart: I should like to give the right hon. Gentleman a little longer to deal with the fundamentals of the situation. I did not ask what the I.D.C. position would be. I said that I found it impossible to believe that one could operate a successful I.D.C. policy with the free flow of capital under the Treaty of Rome.

Mr. Noble: The right hon. Lady can certainly find out what the position is by asking her right hon. Friend the Member for Dundee, East (Mr. George Thomson), but I.D.C. policy is being operated by the French in Paris, and there is no information, either from the capital point of view or I.D.Cs., that we need to change our particular policy.

Mr. Buchan: Mr. Buchan rose—

Mr. Noble: I am sorry, but there are many points still to be covered. I understood what was said, and I have given the right hon. Lady the answer.
The right hon. Lady—and I took this one down, too—talked about her Government when she was a member of the Cabinet and said, "We had not reduced the unemployment figures as much as we would have liked". That is a fairly good description of doubling the unemployment figure in four years. The right hon. Lady went on to say, with great pride, that her Government had solved the balance of payments problems and so could not at the same time have any growth. She did not mention that they had very largely increased the short-term indebtedness of Britain, which somebody else had to repay.

Mr. James Hamilton: Mr. James Hamilton rose—

Mr. Noble: I am sorry, but I have only 10 minutes in which to wind up a long debate.
I thought that my hon. Friend the Member for Edinburgh, South (Mr. Clark Hutchison) spoke very sensibly about the problems of Scotland from the point of view of a Scotsman who knows that we

have considerable skills, considerable inventive genius, and considerable ability to work, and who finds it depressing and difficult to understand why we are continually in this sort of position. I have great sympathy with what he said. I believe that this is not endemic in Scotland, but there are moments—and this debate almost annually is one of them—when we do our best to tear ourselves to pieces for the benefit of nobody.
I know my hon. Friend's passionate desire to keep out of the Common Market. He proudly said that his factory in West Dunbartonshire could beat the Common Market, whatever it does, but just to encourage his shareholders may I tell him that, if we succeed in getting into the Common Market as the tariff on clocks from this country is about 10 per cent. he will be able greatly to increase the employment in his area, and make a great many more clocks.
My hon. Friend the Member for Aberdeenshire, East (Mr. Wolrige-Gordon) asked two questions. First, whether, if the oil which we all hope will be found off his coast is to come into Peterhead, the Government will be able to help in any reasonable way to establish the necessary facilities in his area. I am certain that all the help that is provided for D.A.s will be available for this purpose, and I think we all hope that this area will benefit from the rather fortunate discovery of oil.
As regards the small shipyards, I think that a meeting, which I believe has been discussed with the Scottish Office, might be of use, and I hope that my hon. Friend will be able to attend such a meeting to consider what is the right solution to the problem.
I should like to be able to answer the questions asked by the hon. Member for Inverness (Mr. Russell Johnston) about exactly what will happen with regard to the grant of franchises and royalties. I think that we should wait until we see what we get before we decide how we are going to spend it. That may not be a very liberal approach, but it is a practical one, and I think that there may be more than his party and mine trying to see that we get the maximum amount for Scotland.
My hon. Friend the Member for Perth and West Perthshire (Mr. MacArthur) spoke about the American investment


that had come to Scotland in the past. I should merely like to add to what he said that this investment did not come in only to get into the Commonwealth area. It came in, particularly in the early 'sixties, not only to get the benefits of proximity to Europe, but to the E.F.T.A. market as well.
I have great hopes that if we succeed in our Common Market endeavours there will be great potential for new industry in Scotland, not only from America but also from Europe. My hon. Friend the Member for Fife, East (Sir J. Gilmour) seemed to strike a cheerful note by asking for the reduction of the whisky duty and the abolition of petrol duty on the Islands. I shall have the greatest possible pleasure in submitting both suggestions to the Chancellor of the Exchequer on his behalf.
My hon. Friend the Member for Ross and Cromarty (Mr. Gray) and the hon. Member for the Western Isles (Mr. Donald Stewart) both asked about regional policies if we go into Europe. As I have said about the I.D.C. policy, there is at the moment no visible sign that anything we are doing by way of regional policy would not be allowed in Europe. I cannot say that I agree with the hon. Member for the Western Isles in his views about either the rocket bases, the Polaris bases or the gunnery range. We may approach these things from different ends. I do find it a little distressing that someone should complain bitterly about unemployment in his area and yet feel so strongly about rockets that he should want to turn away jobs. He should consult his constituents before making that sort of statement on their behalf, although I appreciate that he may have strong personal feelings about it.

My hon. Friend the Member for Galloway (Mr. Brewis) asked whether, if the gunnery range came to his area, there would be a public inquiry. My right hon. Friend says that it is early days to decide whether this is the way he would deal with that matter. My hon. Friend the Member for Banff (Mr. W. H. H. Baker) raised a number of points on the Common Market. I cannot answer these today, but I have no doubt that he will take part in the very long debate on the subject later on.

In conclusion—[HON. MEMBERS : "Hear, hear."] I think it is fair to say that we have had a serious debate. It has finished up in the usual Scottish way with Minister being shouted at on all sides. I have seen it all too often.

I finish on one serious note. This is a problem which affects every one of us who lives or works in Scotland. We all have a considerable part to play in creating the right atmosphere for business to come to Scotland and for people to work in the factories under reasonable conditions. This is not something just for the trade unions, neither is it for industrialists alone. It is something in which all of us in the House can help. If we do that the future of Scotland will be a great deal better than if we spend the time barking at each other about who did what when—

Mr. Walter Harrison: Mr. Walter Harrison (Wakefield) rose in his place and claimed to move. That the Question be now put.

Question, That the Question be now put, put and agreed to.

Question put accordingly, That the the Amendment be made :—

The House divided : Ayes 305, Noes 272.

Division No. 423.]
AYES
[10.0 p.m.


Adley, Robert
Bennett, Sir Frederic (Torquay)
Brewis, John


Alison, Michael (Barkston Ash)
Bennett, Dr. Reginald (Gosport)
Brinton, Sir Tatton


Allason, James (Hemel Hempstead)
Benyon, W.
Brocklebank-Fowler, Christopher


Amery, Rt. Hn. Julian
Berry, Hn. Anthony
Brown, Sir Edward (Bath)


Archer, Jeffrey (Louth)
Biffen, John
Bruce-Gardyne, J.


Astor, John
Biggs-Davison, John
Bryan, Paul


Atkins, Humphrey
Blaker, Peter
Buchanan-Smith, Alick (Angus, N&amp;M)


Awdry, Daniel
Boardman, Tom (Leicester, S.W.)
Buck, Antony


Baker, Kenneth (St. Marylebone)
Body, Richard
Bullus, Sir Eric


Baker, W. H. K. (Banff)
Boscawen, Robert
Burden, F. A.


Balniel, Lord
Bossom, Sir Clive
Butler, Adam (Bosworth)


Barber, Rt. Hn. Anthony
Bowden, Andrew
Campbell, Rt. Hn. G.(Moray&amp;Nairn)


Batsford, Brian
Boyd-Carpenter, Rt. Hn. John
Carlisle, Mark


Beamish, Col. Sir Tufton
Braine, Bernard
Carr, Rt. Hn. Robert


Bell, Ronald
Bray, Ronald
Channon, Paul




Chapman, Sydney
Hiley, Joseph
Owen, Idris (Stockport, N.)


Chataway, Rt. Hn. Christopher
Hill, James (Southampton, Test)
Page, Graham (Crosby)


Churchill, W. S.
Holland, Philip
Page, John (Harrow, W.)


Clark, William (Surrey, E.)
Holt, Miss Mary
Parkinson, Cecil (Enfield, W.)


Clarke, Kenneth (Rushcliffe)
Hordern, Peter
Peel, John


Clegg, Walter
Hornby, Richard
Percival, Ian


Cockeram, Eric
Hornsby-Smith, Rt. Hn. Dame Patricia
Peyton, Rt. Hn. John


Cooke, Robert
Howe, Hn. Sir Geoffrey (Reigate)
Pike, Miss Mervyn


Coombs, Derek
Howell, David (Guildford)
Pink, R. Bonner


Cooper, A. E.
Howell, Ralph (Norfolk, N.)
Pounder, Rafton


Cordle, John
Hunt, John
Powell, Rt. Hn. J. Enoch


Corfield, Rt. Hn. Frederick
Hutchison, Michael Clark
Price, David (Eastleigh)


Cormack, Patrick
Iremonger, T. L.
Proudfoot, Wilfred


Costain, A. P.
Irvine, Bryant Godman (Rye)
Pym, Rt. Hn. Francis


Critchley, Julian
James, David
Quennell, Miss J. M.


Crouch, David
Jenkin, Patrick (Woodford)
Rawlinson, Rt. Hn. Sir Peter


Crowder, F. P.
Jennings, J. C. (Burton)
Redmond, Robert


Curran, Charles
Jessel, Toby
Reed, Laurance (Bolton, E.)


Davies, Rt. Hn. John (Knutsford)
Johnson Smith. G. (E. Grinstead)
Rees, Peter (Dover)


d'Avigdor-Goldsmid, Sir Henry
Jones, Arthur (Northants, S.)
Rees-Davies, W. R.


d'Avigdor-Goldsmid. Maj.-Gen. James
Jopling, Michael
Renton, Rt. Hn. Sir David


Dean, Paul
Joseph, Rt. Hn. Sir Keith
Rhys Williams, Sir Brandon


Deedes, Rt. Hn. W. F.
Kershaw, Anthony
Ridley, Hn. Nicholas


Digby, Simon Wingfield
Kilfedder, James
Ridsdale, Julian


Dixon, Piers
Kimball, Marcus
Rippon, Rt. Hn. Geoffrey


Dodds-Parker, Douglas
King, Evelyn (Dorset, S.)
Roberts, Michael (Cardiff, N.)


Douglas-Home, Rt, Hn. Sir Alec
King, Tom (Bridgwater)
Rodgers, Sir John (Sevenoaks)


Drayson, G. B.
Kinsey, J. R.
Rossi, Hugh (Hornsey)




Rost, Peter


du Cann, Rt. Hn. Edward
Kitson, Timothy
Russell, Sir Ronald


Dykes, Hugh
Knox, David
St. John-Stevas, Norman


Eden, Sir John
Lambton, Antony
Sandys, Rt. Hn. D.


Edwards, Nicholas (Pembroke)
Lane, David
Scott, Nicholas


Elliot, Capt. Walter (Carshalton)
Langford-Holt, Sir John
Scott-Hopkins, James


Elliott, R. W. (N'c'tle-upon-Tyne, N.)
Legge-Bourke, Sir Harry
Sharples, Richard


Emery, Peter
Le Marchant, Spencer
Shaw, Michael (Sc'b'gh &amp; Whitby)


Farr, John
Lewis, Kenneth (Rutland)
Shelton, William (Clapham)


Fell, Anthony
Lloyd, Rt. Hn. Geoffrey (Sut'nC'dfield)
Simeons, Charles


Fenner, Mrs. Peggy
Longden, Gilbert
Sinclair, Sir George


Fidler, Michael
Loveridge, John
Skeet, T. H. H.


Finsberg, Geoffrey (Hampstead)
Luce, R. N.
Smith, Dudley (W'wick &amp; L'mington)


Fisher, Nigel (Surbiton)
McAdden, Sir Stephen
Soref, Harold


Fookes, Miss Janet
MacArthur, Ian
Speed, Keith


Fortescue, Tim
McCrindle, R. A.
Spence, John


Foster, Sir John
McLaren, Martin
Sproat, Iain


Fowler, Norman
Maclean, Sir Fitzroy
Stainton, Keith


Fox, Marcus
McMaster, Stanley
Stanbrook, Ivor


Fraser, Rt. Hn. Hugh (St'fford &amp; Stone)
Macmillan, Maurice (Farnham)
Stewart-Smith. D. G. (Belper)


Fry, Peter
McNair-Wilson, Michael
Stodart, Anthony (Edinburgh, W.)


Galbraith, Hn. T. G.
McNair-Wilson, Patrick (NewForest)
Stoddart-Scott, Col. Sir M.


Gardner, Edward
Maddan, Martin
Stokes, John


Gibson-Watt, David
Madel, David
Stuttaford, Dr. Tom


Gilmour, Ian (Norfolk, C.)
Marten, Neil
Sutcliffe, John


Gilmour, Sir John (Fife, E.)
Mather, Carol
Tapsell, Peter


Glyn, Dr. Alan
Maude, Angus
Taylor, Sir Charles (Eastbourne)


Godber, Rt. Hn. J. B.
Maudling, Rt. Hn. Reginald
Taylor, Edward M.(G'gow, Cathcart)


Goodhart, Philip
Mawby, Ray
Taylor, Frank (Moss Side)


Goodhew, Victor
Maxwell-Hyslop, R. J.
Taylor, Robert (Croydon, N. W.)


Gorst, John
Meyer, Sir Anthony
Tebbit, Norman


Gower, Raymond
Mills, Peter (Torrington)
Temple, John M.


Grant, Anthony (Harrow, C.)
Mills, Stratton (Belfast, N.)
Thatcher, Rt. Hn. Mrs. Margaret


Gray, Hamish
Miscampbell, Norman
Thomas, John Stradling (Monmouth)


Green, Alan
Mitchell, Lt.-Col. C.(Aberdeenshire, W.)
Thomas, Rt. Hn. Peter (Hendon, S.)


Grieve, Percy
Mitchell, David (Basingstoke)
Thompson, Sir Richard (Croydon, S.)


Griffiths, Eldon (Bury St. Edmunds)
Moate, Roger
Tilney, John


Grylls, Michael
Molyneaux, James



Gummer, Selwyn
Money, Ernle
Trafford, Dr. Anthony


Gurden, Harold
Monks, Mrs. Connie
Trew, Peter


Hall, Miss Joan (Keighley)
Monro, Hector
Tugendhat, Christopher


Hall, John (Wycombe)
Montgomery, Fergus
Turton, Rt Hn. Sir Robin


Hall-Davis, A. G. F.
Morgan, Geraint (Denbigh)
van Straubenzee, W. R.


Hamilton, Michael (Salisbury)
Morgan-Giles, Rear-Adm.
Vaughan, Dr. Gerard


Hannam, John (Exeter)
Morrison, Charles (Devizes)
Vickers, Dame Joan



Mudd, David
Waddington, David


Harrison, Brian (Maldon)
Murton, Oscar
Walder, David (Clitheroe)


Harrison, Col. Sir Harwood (Eye)
Nabarro, Sir Gerald
Walker, Rt. Hn. Peter (Worcester)


Haselhurst, Alan
Neave, Airey
Walker-Smith, Rt. Hn. Sir Derek


Hastings, Stephen
Nicholls, Sir Harmar
Wall, Patrick


Havers, Michael
Noble, Rt. Hn. Michael
Walters, Dennis


Hawkins, Paul
Normanton, Tom
Ward, Dame Irene


Hay, John
Nott, John
Warren, Kenneth


Hayhoe, Barney
Onslow, Cranley
Weatherill, Bernard


Heseltine, Michael
Oppenheim, Mrs. Sally
Wells, John (Maidstone)


Hicks, Robert
Orr, Capt. L. P. S.
White, Roger (Gravesend)


Higgins, Terence L.
Osborn, John
Whitelaw, Rt. Hn. William







Wiggin, Jerry
Woodnutt, Mark



Wilkinson, John
Worsley, Marcus
TELLERS FOR THE AYES :


Wolrige-Gordon, Patrick
Wylie, Rt. Hn. N. R.
Mr. Reginald Eyre and


Wood, Rt. Hn. Richard
Younger, Hn. George
Mr. Jasper More.


Woodhouse, Hn. Christopher






NOES


Abse, Leo
Fitch, Alan (Wigan)
Lyon, Alexander W. (York)


Albu, Austen
Fitt, Gerard (Belfast, W.)
Lyons, Edward (Bradford, E.)


Allaun, Frank (Salford, E.)
Fletcher, Ted (Darlington)
Mabon, Dr. J. Dickson


Allen, Scholefield
Foley, Maurice
McBride, Neil


Archer, Peter (Rowley Regis)
Foot, Michael
McCann, John


Armstrong, Ernest
Ford, Ben
McCartney, Hugh


Ashley, Jack
Forrester, John
McElhone, Frank


Ashton, Joe
Fraser, John (Norwood)
McGuire, Michael


Atkinson, Norman
Freeson, Reginald
Mackenzie, Gregor


Bagier, Gordon A. T.
Galpern, Sir Myer
Mackie, John


Barnett, Guy (Greenwich)
Garrett, W. E.
Maclennan, Robert


Barnett, Joel
Gilbert, Dr. John
McMillan, Tom (Glasgow, C.)


Benn, Rt. Hn. Anthony Wedgwood
Ginsburg, David
McNamara, J. Kevin


Bennett, James (Glasgow, Bridgeton)
Golding, John
Mahon, Simon (Bootle)


Bidwell, Sydney
Gordon Walker, Rt&amp; Hn. P. C.
Mallalieu, E. L. (Brigg)


Bishop, E. S.
Gourlay, Harry
Mallalieu, J. P. W. (Huddersfield, E.)


Blenkinsop, Arthur
Grant, George (Morpeth)
Marks, Kenneth


Boardman, H. (Leigh)
Grant, John D. (Islington, E.)
Marquand, David


Booth, Albert
Griffiths, Eddie (Brightside)
Marsden, F.


Bottomley, Rt. Hn. Arthur
Griffiths, Will (Exchange)
Marshall, Dr. Edward


Boyden, James (Bishop Auckland)
Grimond, Rt. Hn. J.
Mason, Rt. Hn. Roy


Bradley, Tom
Gunter, Rt. Hn. R. J.
Mayhew, Christopher


Brown, Bob (N'c'tle-upon-Tyne, W.)
Hamilton, James (Bothwell)
Mellish, Rt. Hn. Robert


Brown, Hugh D. (G'gow, Provan)
Hamilton, William (Fife, W.)
Mendelson, John


Brown, Ronald (Shoreditch &amp; F'bury)
Hamling, William
Mikardo, Ian


Buchan, Norman
Hannan, William (G'gow, Maryhill)
Millan, Bruce


Buchanan, Richard (G'gow, Sp'burn)
Hardy, Peter
Miller, Dr. M. S.


Butler, Mrs. Joyce (Wood Green)
Harrison, Walter (Wakefield)
Milne, Edward (Blyth)


Callaghan, Rt. Hn. James
Hart, Rt. Hn. Judith
Mitchell, R. C. (S'hampton, Itchen)


Campbell, I. (Dunbartonshire, W.)
Hattersley, Roy
Molloy, William


Cant, R. B.
Healey, Rt. Hn. Denis
Morgan, Elystan (Cardiganshire)


Carmichael, Neil
Heffer, Eric S.
Morris, Alfred (Wythenshawe)


Carter, Ray (Birmingh'm, Northfield)
Hilton, W. S.
Morris, Charles R. (Openshaw)


Carter-Jones, Lewis (Eccles)
Hooson, Emlyn
Morris, Rt. Hn. John (Aberavon)


Castle, Rt. Hn, Barbara
Horam, John
Moyle, Roland


Clark, David (Colne Valley)
Houghton. Rt. Hn. Douglas
Murray, Ronald King


Cocks, Michael (Bristol, S.)
Howell, Denis (Small Heath)
Ogden, Eric


Cohen, Stanley
Huckfield, Leslie
O'Halloran, Michael


Concannon, J. D.
Hughes, Rt. Hn. Cledwyn (Anglesey)
O'Malley, Brian


Conlan, Bernard
Hughes, Mark (Durham)
Oram, Bert


Corbet, Mrs. Freda
Hughes, Robert (Aberdeen, N.)
Orme, Stanley


Cox, Thomas (Wandsworth, C.)
Hunter, Adam
Oswald, Thomas


Crawshaw, Richard
Irvine, Rt. Hn. SirArthur (Edge Hill)
Owen, Dr. David (Plymouth, Sutton)


Cronin, John
Janner, Greville
Padley, Walter


Crosland, Rt. Hn. Anthony
Jay, Rt. Hn. Douglas
Paget, R. T.


Crossman, Rt. Hn. Richard
Jeger, Mrs. Lena (H'b'n&amp;St. P'cras, S.)
Palmer, Arthur


Cunningham, G. (Islington, S. W.)
Jenkins, Hugh (Putney)
Pannell, Rt. Hn. Charles


Dalyell, Tam
Jenkins, Rt. Hn. Roy (Stechford)
Pardoe, John


Darling, Rt. Hn. George
John, Brynmor
Parker, John (Dagenham)


Davidson, Arthur
Johnson, Carol (Lewisham, S.)
Parry, Robert (Liverpool, Exchange)


Davies, Denzil (Llanelly)
Johnson, James (K'ston-on-Hull, W.)
Peart, Rt. Hn. Fred




Pendry, Tom


Davies, G. Elfed (Rhondda, E.)
Johnson, Walter (Derby, S.)
Pentland, Norman


Davies, Ifor (Gower)
Johnston, Russell (Inverness)
Perry, Ernest G.


Davies, S. O. (Merthyr Tydvil)
Jones, Barry (Flint, E.)
Prentice, Rt. Hn. Reg.


Davis, Clinton (Hackney, C.)
Jones, Dan (Burnley)
Prescott, John


Davis, Terry (Bromsgrove)
Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)
Price, J. T. (Westhoughton)


Dcakins, Eric
Jones, Gwynoro (Carmarthen)
Price, William (Rugby)


de Freitas, Rt. Hn. Sir Geoffrey
Jones, T. Alec (Rhondda, W.)
Probert, Arthur


Delargy, H. J.
Judd, Frank
Rankin, John


Dell, Rt. Hn. Edmund
Kaufman, Gerald
Reed, D. (Sedgefield)


Dempsey, James
Kelley, Richard
Rees, Merlyn (Leeds, S.)


Doig, Peter
Kerr, Russell
Rhodes, Geoffrey


Dormand, J. D.
Kinnock, Neil
Richard, Ivor


Douglas, Dick (Stirlingshire, E.)
Lambie, David
Roberts, Alhert (Normanton)


Douglas-Mann, Bruce
Lamond, James
Roberts, Rt. Hn. Goronwy (Caernarvon)


Duffy, A. E. P.
Latham, Arthur
Robertson, John (Paisley)


Dunn, James A.
Lawson, George
Roderick, CaerwynE. (Br'c'n&amp;R'dnor)


Dunnett, Jack
Leadbitter, Ted
Rodgers, William (Stockton-on-Tees)


Eadie, Alex
Lee, Rt. Hn. Frederick
Roper, John


Edelman, Maurice
Leonard, Dick
Ross, Rt. Hn. William (Kilmarnock)


Ellis, Tom
Lever, Rt. Hn. Harold
Sandelson, Neville


English, Michael
Lewis, Arthur (W. Ham N.)
Sheldon, Robert (Ashton-under-Lyne)


Evans, Fred
Lewis, Ron (Carlisle)
Shore, Rt. Hn. Peter (Stepney)


Faulds, Andrew
Lipton, Marcus
Short, Rt. Hn. Edward (N 'c'stle-u-Tyne)


Fernyhough, Rt. Hn. E.
Lomas, Kenneth
Short, Mrs. Renée (W'hampton, N. E.)


Fisher, Mrs. Doris (B'ham, Ladywood)
Loughlin, Charles
Silkin, Rt. Hn. John (Deptford)







Silkin, Hn. S. C. (Dulwich)
Taverne, Dick
Wellbeloved, James


Sillars, James
Thomas, Rt. Hn. George (Cardiff, W.)
Wells, William (Walsall, N.)


Silverman, Julius
Thomas, Jeffrey (Abertillery)
White, James (Glasgow, Pollok)


Skinner, Dermis
Thomson, Rt. Hn. G. (Dundee, E.)
Whitehead, Phillip


Small, William
Thorpe, Rt. Hn. Jeremy
Whitlock, William


Smith, John (Lancashire, N.)
Tinn, James
Willey, Rt. Hn. Frederick


Spearing, Nigel
Tomney, Frank
Williams, Mrs. Shirley (Hitchin)


Spriggs, Leslie
Torney, Tom
Wilson, Alexander (Hamilton)


Stallard, A. W.
Tuck, Raphael
Wilson, Rt. Hn. Harold (Huyton)


Steel, David
Urwin, T. W.
Wilson, William (Coventry, S.)


Stewart, Donald (Western Isles)
Varley, Eric G.
Woof, Robert


Stoddart, David (Swindon)
Wainwright, Edwin



Stonehouse, Rt. Hn. John
Walden, Brian (B'm'ham, All Saints)
TELLERS FOR THE NOES :


Strang, Cavin
Wallace, George
Mr. Donald Coleman and


Strauss, Rt. Hn. G. R.
Watkins, David
Mr. Joseph Harper.


Summerskill, Hn. Dr. Shirley
Weitzman, David

Main Question, as amended, put :—

The house divided: Ayes 305, Noes 272.

Division No. 424.]
AYES
[10.13 p.m.


Adley, Robert
Critchley, Julian
Harrison, Col. Sir Harwood (Eye)


Alison, Michael (Barkston Ash)
Crouch, David
Haselhurst, Alan


Allason, James (Hemel Hempstead)
Crowder, F. P.
Hastings, Stephen


Amery, Rt. Hn. Julian
Curran, Charles
Havers, Michael


Archer, Jeffrey (Louth)
Davies, Rt. Hn. John (Knutsford)
Hawkins, Paul


Astor, John
d'Avigdor-Goldsmid, Sir Henry
Hay, John


Atkins, Humphrey
d'Avigdor-Goldsmid, Maj.-Gen. James
Hayhoe, Barney


Awdry, Daniel
Dean, Paul
Heseltine, Michael


Baker, Kenneth (St. Marylebone)
Deedes, Rt. Hn. W. F.
Hicks, Robert


Baker, w. H. K. (Banff)
Digby, Simon Wingfield
Higgins, Terence L.


Balniel, Lord
Dixon, Piers
Hiley, Joseph


Barber, Rt. Hn. Anthony
Dodds-Parker, Douglas
Hill, James (Southampton, Test)


Batsford, Brian
Douglas-Home, Rt. Hn. Sir Alec
Holland, Philip


Beamish, Col. Sir Tufton
Drayson, G. B.
Holt, Miss Mary


Bell, Ronald
du Cann, Rt. Hn. Edward
Hordern, Peter


Bennett, Sir Frederic (Torquay)
Dykes, Hugh
Hornby, Richard


Bennett, Dr. Reginald (Gosport)
Eden, Sir John
Hornsby-Smith, Rt. Hn. Dame Patricia


Benyon, W.
Edwards, Nicholas (Pembroke)
Howe, Hn. Sir Geoffrey (Reigate)


Berry, Hn. Anthony
Elliot, Capt. Walter (Carshalton)
Howell, David (Guildford)


Biffen, John
Elliott, R. W. (N'c'tle-upon-Tyne, N.)
Howell, Ralph (Norfolk, N.)


Biggs-Davison, John
Emery, Peter
Hunt, John


Blaker, Peter
Farr, John
Hutchison, Michael Clark


Boardman, Tom (Leicester, S. W.)
Fell, Anthony
Iremonger, T. L.


Body, Richard
Fenner, Mrs. Peggy
Irvine, Bryant Godman (Rye)


Boscawen, Robert
Fidler, Michael
James, David


Bossom, Sir Clive
Finsberg, Geoffrey (Hampstead)
Jenkin, Patrick (Woodford)


Bowden, Andrew
Fisher, Nigel (Surbiton)
Jennings, J. C. (Burton)


Boyd-Carpenter, Rt. Hn. John
Fookes, Miss Janet
Jessel, Toby


Braine, Bernard
Fortescue, Tim
Johnson Smith, G. (E. Grinstead)


Bray, Ronald
Foster, Sir John
Jones, Arthur (Northants, S.)


Brewis, John
Fowler, Norman
Jopling, Michael


Brinton, Sir Tatton
Fox, Marcus
Joseph, Rt. Hn. Sir Keith


Brocklebank-Fowler, Christopher
Fraser, Rt. Hn. Hugh (St' fford &amp; Stone)
Kershaw, Anthony


Brown, Sir Edward (Bath)
Fry, Peter
Kilfedder, James


Bruce-Gardyne, J.
Galbraith, Hn. T. G.
Kimball, Marcus


Bryan, Paul
Gardner, Edward
King, Evelyn (Dorset, S.)


Buchanan-Smith, Alick (Angus, N&amp;M)
Gibson-Watt. David
King, Tom (Bridgwater)


Buck, Antony
Gilmour, Ian (Norfolk, C.)
Kinsey, J. R.


Bullus, Sir Eric
Gilmour, Sir John (Fife, E.)
Kitson, Timothy


Burden, F. A.
Glyn, Dr. Alan
Knox, David




Lambton, Antony


Butler, Adam (Bosworth)
Godber, Rt. Hn. J. B.
Lane, David


Campbell, Rt. Hn. G. (Moray&amp;Nairn)
Goodhart, Philip
Langford-Holt, Sir John


Carlisle, Mark
Goodhew, Victor
Legge-Bourke, Sir Harry


Carr, Rt. Hn. Robert
Gorst, John
Le Marchant, Spencer


Channon, Paul
Gower, Raymond
Lewis, Kenneth (Rutland)


Chapman, Sydney
Grant, Anthony (Harrow, C.)
Lloyd, Rt. Hn. Geoffrey (Sut'nC'dfield)


Chataway, Rt. Hon. Christopher
Cray, Hamish
Longden, Gilbert


Churchill, W. S.
Green, Alan
Loveridge, John


Clark, William (Surrey, E.)
Grieve, Percy
Luce, R. N.


Clarke, Kenneth (Rushcliffe)
Griffiths, Eldon (Bury St. Edmunds)
McAdden, Sir Stephen


Clegg, Walter
Grylls, Michael
MacArthur, Ian


Cockeram, Eric
Gummer, Selwyn
McCrindle, R. A.


Cooke, Robert
Curden, Harold
McLaren, Martin


Coombs, Derek
Hall, Miss Joan (Keighley)
Maclean, Sir Fitzroy


Cooper, A. E.
Hall, John (Wycombe)
McMaster, Stanley


Cordle, John
Hall-Davis, A. G. F.
Macmillan, Maurice (Farnham)


Corfield, Rt. Hn. Frederick
Hamilton, Michael (Salisbury)
McNair-Wilson, Michael


Cormack, Patrick
Hannam, John (Exeter)
McNair-Wilson, Patrick (NewForest)


Costain, A. P.
Harrison, Brian (Maldon)
Maddan, Martin




Madel, David
Powell, Rt. Hn. J. Enoch
Taylor, Sir Charles (Eastbourne)


Marten, Neil
Price, David (Eastleigh)
Taylor, Edward M.(G'gow, Cathcart)


Mather, Carol
Proudfoot, Wilfred
Taylor, Frank (Moss Side)


Maude, Angus
Pym, Rt. Hn. Francis
Taylor, Robert (Croydon, N, W.)


Maudling, Rt. Hn. Reginald
Quennell, Miss J. M.
Tebbit, Norman


Mawby, Ray
Rawlinson, Rt. Hn. Sir Peter
Temple, John M.


Maxwell-Hyslop, R. J.
Redmond, Robert
Thatcher, Rt. Hn. Mrs. Margaret


Meyer, Sir Anthony
Reed, Laurance (Bolton, E.)
Thomas, John Stradling (Monmouth)


Mills, Peter (Torrington)
Rees, Peter (Dover)
Thomas, Rt. Hn. Peter (Hendon, S.)


Mills, Stratton (Belfast, N.)
Rees-Davies, W. R.
Thompson, Sir Richard (Croydon, S.)


Miscampbell, Norman
Renton, Rt. Hn. Sir David
Tilney, John


Mitchell, Lt.-Col. C. (Aberdeenshire, W)
Rhys Williams, Sir Brandon
Trafford, Dr Anthony


Mitchell, David (Basingstoke)
Ridley, Hn. Nicholas
Trew, Peter


Moate, Roger
Ridsdale, Julian
Tugendhat, Christopher


Molyneaux, James
Rippon, Rt. Hn. Geoffrey
Turton, Rt. Hn. Sir Robin


Money, Ernle
Roberts, Michael (Cardiff, N.)
van Straubenzee, W. R.


Monks, Mrs. Connie
Rodgers, Sir John (Sevenoaks)
Vaughan, Dr. Gerard


Monro, Hector
Rossi, Hugh (Hornsey)
Vickers, Dame Joan


Montgomery, Fergus
Rost, Peter
Waddington, David


Morgan, Geraint (Denbigh)
Russell, Sir Ronald
Walder, David (Clitheroe)


Morgan-Giles, Rear-Adm.
St. John-Stevas, Norman
Walker, Rt. Hn. Peter (Worcester)


Morrison, Charles (Devizes)
Sandys, Rt. Hn. D.
Walker-Smith, Rt. Hn. Sir Derek


Mudd, David
Scott, Nicholas
Wall, Patrick


Murton, Oscar
Scott-Hopkins, James
Walters, Dennis


Nabarro, Sir Gerald
Sharples, Richard
Ward, Dame Irene


Neave, Airey
Shaw, Michael (Sc'b'gh &amp; Whitby)
Warren, Kenneth


Nicholls, Sir Harmar
Shelton, William (Clapham)
Weatherill, Bernard


Noble, Rt. Hn. Michael
Simeons, Charles
Wells, John (Maidstone)


Normanton, Tom
Sinclair, Sir George
White, Roger (Cravesend)


Nott, John
Skeet, T. H. H.
Whitelaw, Rt. Hn. William


Onslow, Cranley
Smith, Dudley (W'wick &amp; L'mington)
Wiggin, Jerry


Oppenheim, Mrs. Sally
Soref, Harold
Wilkinson, John


Orr, Capt. L. P. S.
Speed, Keith
Wolrige-Gordon, Patrick


Osborn, John
Spence, John
Wood, Rt. Hn. Richard


Owen, Idris (Stockport, N.)
Sproat, lain
Woodhouse, Hn. Christopher


Page, Graham (Crosby)
Stainton, Keith
Woodnutt, Mark


Page, John (Harrow, W.)
Stanbrook, Ivor
Worsley, Marcus


Parkinson, Cecil (Enfield, W.)
Stewart-Smith, D. G. (Belper)
Wylie, Rt. Hn. N. R.


Peel, John
Stodart, Anthony (Edinburgh, W.)
Younger, Hn. George


Percival, Ian
Stoddart-Scott, Col. Sir M.



Peyton, Rt. Hn. John
Stokes, John
TELLERS FOR THE AYES :


Pike, Miss Mervyn
Stuttaford, Dr. Tom
Mr. Reginald Eyre and


Pink, R. Bonner
Sutcliffe, John
Mr. Jasper More.


Pounder, Rafton
Tapsell, Peter





NOES


Abse, Leo
Cocks, Michael (Bristol, S.)
English, Michael


Albu, Austen
Cohen, Stanley
Evans, Fred


Allaun, Frank (Salford, E.)
Coleman, Donald
Faulds, Andrew


Allen, Scholefield
Concannon, J. D.
Fernyhough, Rt. Hn. E.


Archer, Peter (Rowley Regis)
Conlan, Bernard
Fisher, Mrs. Doris (B'ham, Ladywood)


Armstrong, Ernest
Corbet, Mrs. Freda
Fitch, Alan (Wigan)


Ashley, Jack
Cox, Thomas (Wandsworth, C.)
Fitt, Gerard (Belfast, W.)


Ashton, Joe
Crawshaw, Richard
Fletcher, Ted (Darlington)


Atkinson, Norman
Cronin, John
Foley, Maurice


Bagier, Gordon A. T.
Crosland, Rt. Hn. Anthony
Foot, Michael


Barnett, Guy (Greenwich)
Crossman, Rt. Hn. Richard
Ford, Ben


Barnett, Joel
Cunningham, G. (Islington, S. W.)
Forrester, John


Benn, Rt. Hn. Anthony Wedgwood
Dalyell, Tam
Fraser, John (Norwood)


Bennett, James (Glasgow, Bridgeton)
Darling, Rt. Hn. George
Freeson, Reginald


Bidwell, Sydney
Davidson, Arthur
Galpern, Sir Myer


Bishop, E. S.
Davies, Denzil (Llanelly)
Garrett, W. E.


Blenkinsop, Arthur
Davies, G. Elfed (Rhondda, E.)
Gilbert, Dr. John


Boardman, H. (Leigh)
Davies, Ifor (Gower)
Ginsburg, David


Booth, Albert
Davies, S. O. (Merthyr Tydvil)
Golding, John


Bottomley, Rt. Hn. Arthur
Davis, Clinton (Hackney, C.)
Gordon Walker, Rt. Hn. P. C.


Boyten, James (Bishop Auckland)
Davis, Terry (Bromsgrove)
Gourlay, Harry


Bradley, Tom
Deakins, Eric
Grant, George (Morpeth)


Brown, Bob (N'c'tle-upon-Tyne, W.)
de Freitas, Rt. Hn. Sir Geoffrey
Grant, John D. (Islington, E.)


Brown, Hugh D. (G'gow, Provan)
Defargy, H J.
Griffiths, Eddie (Brightside)


Brown, Ronald (Shoreditch &amp; F'bury)
Dell, Rt. Hn. Edmund
Griffiths, Will (Exchange)


Buchan, Norman
Dempsey, James
Grimond, Rt. Hn. J.


Buchanan, Richard (G'gow, Sp'burn)
Doig, Peter
Gunter, Rt. Hn. R. J.


Butler, Mrs. Joyce (Wood Green)
Dormand, J. D.
Hamilton, William (Fife, W.)


Callaghan, Rt. Hn. James
Douglas, Dick (Stirlingshire, E.)
Hamling, William


Campbell, I. (Dunbartonshire, W.)
Douglas-Mann, Bruce
Hannan, Wiliam (G'gow, Maryhill)


Cant, R. B.
Duffy, A. E. P.
Hardy, Peter


Carmichael, Neil
Dunn, James A.
Harrison, Walter (Wakefield)


Carter, Ray (Birmingh'm, Northfield)
Dunnett, Jack
Hart, Rt. Hn. Judith


Carter-Jones, Lewis (Eccles)
Eadie, Alex
Hattersley, Roy


Castle, Rt. Hn. Barbara
Edelman, Maurice
Healey, Rt. Hn, Denis


Clark, David (Colne Valley)
Ellis, Tom
Heffer, Eric S.







Hilton, W. S.
McNamara, J. Kevin
Rodgers, William (Stockton-on-Tees)


Hooson, Emlyn
Mahon, Simon (Bootle)
Roper, John


Horam, John
Mallalieu, E. L. (Brigg)
Ross, Rt. Hn. William (Kilmarnock)


Houghton, Rt. Hn. Douglas
Mallalieu, J. P. W. (Huddersfield, E.)
Sandelson, Neville


Howell, Denis (Small Heath)
Marks, Kenneth
Sheldon, Robert (Ashton-under-Lyne)


Huckfield, Leslie
Marquand, David
Shore, Rt. Hn. Peter (Stepney)


Hughes, Rt. Hn. Cledwyn (Anglesey)
Marsden, F.
Short, Rt. Hn. Edward (N'c'tle-u-Tyne)


Hughes, Mark (Durham)
Marshall, Dr. Edmund
Short, Mrs. Renée (W'hampton, N.E.)


Hughes, Robert (Aberdeen, N.)
Mason, Rt. Hn. Roy
Silkin, Rt. Hn. John (Deptford)


Hunter, Adam
Mayhew, Christopher
Silkin, Hn. S. C. (Dulwich)


Irvine, Rt. Hn. SirArthur (Edge Hill)
Mellish, Rt. Hn. Robert
Sillars, James


Janner, Greville
Mendelson, John
Silverman, Julius


Jay, Rt. Hn. Douglas
Mikardo, Ian
Skinner, Dennis


Jeger, Mrs. Lena (H'b'n&amp;St. P'cras, S.)
Millan, Bruce
Small, William


Jenkins, Hugh (Putney)
Miller, Dr. M. S.
Smith, John (Lanarkshire, N.)


Jenkins, Rt. Hn. Roy (Stechford)
Milne, Edward (Blyth)
Spearing, Nigel


John, Brynmor
Mitchell, R. C. (S'hampton, Itchen)
Spriggs, Leslie


Johnson, Carol (Lewisham, S.)
Molloy, William
Stallard, A. W.


Johnson, James (K'ston-on-Hull, W.)
Morgan, Elystan (Cardiganshire)
Steel, David


Johnson, Walter (Derby, S.)
Morris, Alfred (Wythenshawe)
Stewart, Donald (Western Isles)


Johnston, Russell (Inverness)
Morris, Charles R. (Openshaw)
Stoddart, David (Swindon)


Jones, Barry (Flint, E.)
Morris, Rt. Hn. John (Aberavon)
Stonehouse, Rt. Hn. John


Jones, Dan (Burnley)
Moyle, Roland
Strang, Gavin


Jonss, Rt. Hn. Sir Elwyn (W. Ham. S.)
Murray, Ronald King
Strauss, Rt. Hn. G. R.


Jones, Gwynoro (Carmarthen)
Ogden, Eric
Summerskill, Hn. Dr. Shirley


Jones, T. Alec (Rhondda, W.)
O'Halloran, Michael
Taverne, Dick


Judd, Frank
O'Malley, Brian
Thomas, Rt. Hn. George (Cardiff, W.)


Kaufman, Gerald
Oram, Bert
Thomas, Jeffrey (Abertillery)


Kelley, Richard
Orme, Stanley
Thomson, Rt. Hn. G. (Dundee, E.)


Kerr, Russell
Oswald, Thomas
Thorpe, Rt. Hn. Jeremy


Kinnock, Neil
Owen, Dr. David (Plymouth, Sutton)
Tinn, James


Lambie, David
Padley, Walter
Tomney, Frank


Lamond, James
Paget, R. T.
Torney, Tom


Latham, Arthur
Palmer, Arthur
Tuck, Raphael


Lawson, George
Pannell, Rt. Hn. Charles
Urwin, T. W.


Leadbitter, Ted
Pardoe, John
Varley, Eric G.


Lee, Rt. Hn. Frederick
Parker, John (Dagenham)
Wainwright, Edwin


Leonard, Dick
Parry, Robert (Liverpool, Exchange)
Walden, Brian (B'm'ham, All Saints)


Lever, Rt. Hn. Harold
Peart, Rt. Hn. Fred
Wallace, George


Lewis, Arthur (W. Ham, N.)
Pendry, Tom
Watkins, David


Lewis, Ron (Carlisle)
Pentland, Norman
Weitzman, David


Lipton, Marcus
Perry, Ernest G.
Wellbeloved, James


Lomas, Kenneth
Prentice, Rt. Hn. Reg.
Wells, William (Walsall, N.)


Loughlin, Charles
Prescott, John
White, James (Glasgow, Pollok)


Lyon, Alexander W. (York)
Price, J. T. (Westhoughton)
Whitehead, Phillip


Lyons, Edward (Bradford, E.)
Price, William (Rugby)
Whitlock, William


Mahon, Dr. J. Dickson
Probert, Arthur
Willey, Rt. Hn. Frederick


McBride, Neil
Rankin, John
Williams, Mrs. Shirley (Hitchin)


McCann, John
Reed, D. (Sedgefield)
Wilson, Alexander (Hamilton)


McCartney, Hugh
Rees, Merlyn (Leeds, S.)
Wilson, Rt. Hn. Harold (Huyton)


McElhone, Frank
Rhodes, Geoffrey
Wilson, William (Coventry, S.)


McGuire, Michael
Richard, Ivor
Woof, Robert


Mackenzie, Gregor
Roberts, Albert (Normanton)



Mackie, John
Roberts, Rt. Hn. Goronwy (Caernarvon)
TELLERS FOR THE NOES :


Maclennan, Robert
Robertson, John (Paisley)
Mr. Joseph Harper and


McMillan, Tom (Glasgow, C.)
Roderick, Caerwyn E.(Br'c'n&amp;R'dnor)
Mr. James Hamilton.

Resolved,

That this House, recognising the special problems that have arisen in Scotland and the regrettably high unemployment accompanying them, which has resulted from the inflationary policies pursued by the last Government, endorses the measures introduced by Her Majesty's Government, including the creation of a special development area covering West Central Scotland and other powerful incentives for regional development, as relevant and effective for dealing with this situation.

BUSINESS OF THE HOUSE

Ordered,

That at this day's Sitting the Motion relating to Education (Scotland) may be proceeded with, though opposed, until half-past Eleven o'clock, and that the Housing Bill, and the Mineral Workings (Offshore Installations) Bill [Lords], may be proceeded with. though opposed, until any hour.—[Mr. Monro.]

SCOTLAND (GRANT-AIDED SECONDARY SCHOOLS)

10.24 p.m.

Mr. Norman Buchan: I beg to move,
That the Grant-Aided Secondary Schools (Scotland) Grant (Amendment) Regulations 1971 (S.I., 1971, No. 558) be withdrawn.
This short debate is taking place against a background different from the usual. It has been the custom in the past that discussions on Regulations of this sort have centred upon the amounts of grant to be paid and the question whether the figures should be increased or reduced. Today, however, we face a rather different situation.
I want to put the figures into the perspective of what the Government have done over the past 12 months, particularly in education. There are 29 grant-aided schools in Scotland. We sometimes hear more about the grant-aided and independent schools from hon. Members opposite than about the basic structure of education. The Regulations apply to about 20,000 pupils.
I find the Regulations very strange. The total amount in the Schedule comes to £1,550,990, exactly the same figure as was in the Regulations of 1969. That is strange, because when we introduced those those similar Regulations they came under a particularly vicious attack. For example, the Under-Secretary of State for Development said that the Order was :
economic nonsense and educational eyewash, and that is why it should be opposed.
Even more important, the Under-Secretary in charge of education said this about those same figures :
They are spiteful little Regulations.. This is a silly, unnecessarily spiteful move …
In case we did not get the point, he said one paragraph later :
an unnecessarily spiteful crack at these schools and all that they stand for."—[OFFICIAL REPORT, 1st July, 1969; Vol. 786, c. 374–376.]
That was said two years ago when costs were not so high as they are under the present, benighted Government. Therefore, we look with some care at the Regulations, as we always do at Tory measures.
If the figures then were spiteful, do the figures in the Schedule really represent the amount the Government intend to give to the fee-paying, grant-aided sector? If they were petty then, the figures they have produced for their friends in those privileged schools must be even pettier and meaner. We are accustomed to petty and mean things from them, but not towards their friends.
Therefore, we must look at some of the small print, where the Regulations say that when
… an increase has taken place since October 1969 in the levels of prices, costs or remuneration …
the Secretary of State may give such increase in the grant as he may determine. The figures are either meaningful, in which case everything the Minister said two years ago was hypocritical nonsense, or they are to mean nothing, and we are getting an open-ended commitment.
I should like to know just what ceiling the Minister has in mind, or whether he has any ceiling in mind for the amount of assistance he will give those fee-paying schools.
We see the Regulations against a double background. During the last discussion there was a big attack on us for having set up the Public Schools Commission. The first aspect of the background is the question of what was to be done with the grant-aided schools. The Commission has reported, and what a devastating Report it is! For example, it said on page 73 of the Second Report, Volume III :
We believe that public feeling and educational opinion is now clearly opposed to selection for secondary education, and few would wish a return to the old selective system, …
The few who would wish a return include the present members of the Tory Administration, cutting right across all educational progress in the past quarter of a century. The Report continues :
… Britain allows a larger proportion of her young people to drop out of school than her neighbours and major competitors, and is already severely handicapped by this waste of talent.
The Commission puts it down to the divisive nature of our school education.
The Report says :
An educational system which enables a fortunate minority of children to take their education a long way while permitting the rest to leave school for the labour market at the minimum leaving age is obsolete.
This Government are not only trying to turn the clock back and ensure again that the minority are brought up and educated in a divisive structure. They cannot even guarantee any longer that the jobs will be there for the children when they leave school. That is the first background against which we are discussing the Regulations.
The Report continues :
There is no time to be lost in creating the new system we need …
We might have looked forward, in view of the publication of this devastating Report, to some understanding of this in the Regulations.
Fee-paying would effectively exert a selective influence—both socially and educationally …
The Report spells out above all the need for a move towards a one-nation type of education—comprehensive education. It says :
We therefore recommend that no school in a comprehensive system should charge fees since fee-paying is inconsistent with its objectives.
To attempt to operate a 'mixed economy' of selective and comprehensive and secondary schools is, as experience has shown, to create two different types of schools, differing in status, esteem and morale … this seems to us to be well illustrated in the evidence we received about the present Edinburgh situation. In our view, therefore, all schools in the public system of education should fulfil comprehensive roles in local schemes of reorganisation.
We have now had the Report and there is not one flicker of understanding, one iota of proof, in these Regulations that the Government have even read the Report. Yet they could have taken cognisance of it in order to move towards the wise findings of this high-powered Commission.
The other background of these Regulations is what the Government have done in their social and education policies since they came to power. There is the question of the return of fee-paying in local authority schools.

Mr. Ian MacArthur: Hear, hear.

Mr. Buchan: But not content with the entire privileged sector of the grant-aided schools, and not content with the privileged sector of the independent and public schools, they are attempting—and it is no more than an attempt—to restore local authority fee-paying schools.

Mr. MacArthur: Hear, hear.

Mr. Buchan: What an image of privilege and élitism this Government show in Scotland. That was not the only thing. Consider their treatment of the children within the State sector, those whom they have left out of their worries about the independent and fee-paying local authority schools, the ordinary kids of Scotland, against a background of 121,000 unemployed, with the number of school meals being taken dropping because parents can no longer afford them in their increasing poverty.

Mr. MacArthur: Mr. MacArthur rose—

Mr. Buchan: Take your time. This is the background against which these Regulations are designed to perpetuate the small, privileged sector of 29 schools.

Mr. MacArthur: If the hon. Gentleman wishes to refer to school meals, I am sure he will be fair about events in Scotland. The figures show that where 15 children took school meals previously 14 take them now. Against that, where 15 children had free school meals before 19 children have them now. This demonstrates that help is being concentrated where help is really needed. Those are the Scottish figures.

Mr. Buchan: The Scottish figures were published today. As my hon. Friend the Member for Greenock (Dr. Mabon) said earlier, "Look at HANSARD and find out for yourself." The number of school meals has been dropping. It has dropped already by about one-fifth. The number of free school meals has been increasing—up to something like 41 per cent. of the total ; it is probably more with each week that passes. The point is that this increase indicates an increase in poverty. If hon. Members opposite do not understand that, they understand nothing and should take their hands off the social services before they do any more damage.

Mr. MacArthur: The hon. Gentleman will surely concede that it is above all


an indication of the increasing band of income within which free school meals are permitted by the Government.

Mr. Buchan: That is not so.

Mr. MacArthur: It is so.

Mr. Buchan: Many of the measures introduced are not yet biting. The other point is that we have seen the statistics of the increasing poverty. They are there to see every month in the Department of Employment's figures. The increase in poverty is coming from the increase in the unemployment. Most of the increases in social benefits have already been eroded by rampant inflation. Poverty is increasing within our ordinary State schools—that is one background against which this privilege must be looked at.
The other background is the financial policies and political dogmas of the Government. What have the three budgets been about? First, they have been in order to cut down public expenditure.

Mr. T. G. D. Galbraith: Hear, hear.

Mr. Buchan: Secondly, they have been to reduce taxation.

Mr. MacArthur: Hear, hear.

Mr. Galbraith: Hear, hear.

Mr. Buchan: Thirdly, they have been to make sure that all the beneficial effects of cutting public expenditure are borne by ordinary people so that tax cuts for the wealthy are paid for by the poor.

Mr. MacArthur: Rubbish.

Mr. Galbraith: Come off it.

Mr. Buchan: Yet the Government, dedicated to cutting public expenditure, produce an open-ended commitment to increasing public expenditure for these grant-aided schools. Where is the cut in public expenditure here? In other words, they are prepared to cut expenditure on school meals ; they are prepared to cut public expenditure by depriving primary school children between the ages of seven and 12 of free school milk. But they are not prepared to cut public expenditure which keeps 20,000 children in a privileged sector of education. They have a curious view of what constitutes social priorities.

Mr. MacArthur: I am grateful to the hon. Member for his courtesy in giving way again. Surely he will recognise that what the Government have done is to direct far greater expenditure to a priority area of need, which is in the State primary schools, which were so grievously neglected by the last Government. That is where the need exists and that is where the money is going—to help young children on the threshhold of education in State primary schools. Cut out all this bunkum!

Mr. Buchan: The hon. Gentleman is wrong again. Is he really saying—

Mr. MacArthur: Yes, I am.

Mr. Buchan: —that the money to be saved by cutting down school meals is to be used for increased building for primary education? That is what he is saying. He should listen to his right hon. Friend the Secretary of State for Education and Science. She said the same thing, but when challenged she said, "Well, when one is stuck for something else to do it is a useful thing to run what is an intellectual exercise." That is all it was. It had nothing to do with expansion of primary schools. The hon. Gentleman should read what members of his Government say before springing to their defence so quickly.

Mr. MacArthur: Total distortion.

Mr. Buchan: We are dealing with a situation in which £1½ million, as a beginning—we do not know how much more is to come—is to be given in the form of grants for these 29 schools while £1 million is being saved by taking away free school milk. Are these the hon. Gentleman's priorities for the children on the threshold of education?

Mr. MacArthur: I am obliged to the hon. Gentleman for his constant courtesy. He is bandying figures around. Does he not recognise that the Government have already put £4½ million more into primary school building in Scotland, which is only the beginning of the increase in the priority area of need?

Mr. Buchan: We have not yet seen the buildings. The sum of £1½ million is to be spent by a Government pledged to cutting public expenditure in order to keep a privileged sector in being while at the same time they are withdrawing £1


million for free milk for children in the free sector of education to pay for it.

Mr. John Brewis: Mr. John Brewis (Galloway) rose—

Mr. Buchan: I will not give way ; I have given way five times. The one person I will give way to is the Under-Secretary of State. When asked about the Common Market on Sunday, he said for the first time in his life that he had no comment. When asked to comment on the no comment, he said that he had no comment on the no comment.

The Under-Secretary of State for Health and Education, Scottish Office (Mr. Edward Taylor): The hon. Gentleman has made very great play of the £1½ million which the Government will give to the grant-aided schools this year which he thinks is outrageous. May I ask the hon. Gentleman, with his great knowledge of education, how much the Labour Government gave grant-aided schools in Scotland last year? I think he will find that the answer is £1½ million.

Mr. Buchan: The hon. Gentleman does not even listen. I started by making precisely that point. I even added up the figures. I did not merely say that the figure was £1½ million ; I said that it was £1,550,000 and gave the odd digits. I wish the hon. Gentleman would listen. That is one thing we want of a Minister responsible for education.
It is astonishing that after the protestations of two years ago the Government have not increased the amendment officially but have left an open-ended formula. I believe that this is an open-ended formula. I want to know the ceiling which the Government propose.
Why do I criticise this amount when it is exactly the same as the amount when we were in office? The answer is that we have had the Report of the Public Schools Commission and we now know what we should be doing with the grant-aided schools. We should be moving them into the general public sector. What is criminal about the Government's proposals is that they are cutting public expenditure for the poor and continuing it for the rich—in fact, since it is open-ended, they are increasing it for the rich—and at the same time are failing to respond to the needs of education.
The Secretary of State for Trade and Industry, in his famous "lame ducks" speech, said :
The vast majority lives and thrives in a bracing climate and not in a soft, sodden morass of subsidised incompetence."—[OFFICIAL REPORT, 4th November, 1970 ; Vol. 805, c. 1212.]
But the same Government who are horror-stricken at the thought of subsidising Upper Clyde Shipbuilders are not against subsidy when it is for their own people.

Mr. MacArthur: Nonsense.

Mr. Buchan: This is exactly what it is. They are not against subsidy when it is for their own people. They welcome this kind of expenditure but oppose every other kind. We are back to the same problem : they are for the rich, the poor they cut. They want subsidy as long as—

Mr. Galbraith: Mr. Galbraith rose—

Mr. Buchan: I will deal with the hon. Gentleman in a moment.
Secondly, there is the problem of written-in selection. Not long ago the Minister said that he was not worried about fee-paying in schools. He said that that was not the problem. He is not worried about perpetuating fee-paying as long as he can abolish selection. This is the bargain he offered two years ago. He was prepared to come to an agreement that as long as he could achieve selection fees could go. Is not that so? Can he not even answer this? If he does not want to answer let him look at column 190 of the 1969 Bill Committee proceedings.
This Government have not only brought back the right of selection but have under-pinned it by giving the right to bring back the local authority fee-paying school, so that privileged parents can buy selection. They are also repeating the same framework in the Regulations for grant-aided schools ; not only can parents get selection but they can buy selection. I will give way to the hon. Member for Perth and East Perthshire (Mr. MacArthur) voluntarily if he wants to tell me what is wrong with this argument. He does not ; so they want to buy selection.
There is a difference from England. It is £1½ million in Scotland, more in


England, but we were told of the virtues of the 25 per cent. intake of free pupils into English grant-aided schools. Without any problem for their dogmas, the Government could have done the same in these Regulations. There is no extension here of the 25 per cent. increase in free places, so they cannot even hold true to that. We are back once more to the question of two nations in education, where school meals, school milk and educational opportunities have been cut and, on the other hand, fee-paying schools have been strengthened.
The effect of this is most clearly seen in Edinburgh. Throughout discussions on local authority fee-paying schools, we pointed out that with the continuation of the grant aided local authority and independent schools, 60 per cent. of the pupils in the fifth year, and 75 per cent. of the pupils in the sixth year of Edinburgh secondary schools were in the fee-paying sector. The result is to create a narrow top to the state sector schools and to cream off staffing resources from the state sector schools into fee-paying schools, creating the very anomaly and bad effect upon the State sector that the Public Schools Commission proved. There is not an atom of response to that report here. The same grant-aided schools will continue at a minimum to receive the same grant. Therefore, it is clear, from the report, the actions of the Government and the Regulations that the whole position is incompatible. We accept and are considering how best to implement the recommendations of the Public Schools Commission. In 1971 we can no longer continue to have two nations and an educational system designed to create two nations.

Mr. Galbraith: Does this mean that the hon. Gentleman does not believe in variety in education and would stop parents having the right to choose the school?

Mr. Buchan: Of course we believe in variety. The only kind of variety the hon. Gentleman can see is that which is paid for or that which is not paid for. What a blinkered vision! Why cannot we have a hundred different types of school? Is a grant-aided school necessary, is exclusiveness of education necessary, to achieve this? The hon. Gentleman is talking about privilege

under the guise of variety. No variety for his children ; no experimental schools there ; but a good fee-paying Scottish traditional school.

Mr. Galbraith: Quite right.

Mr. Buchan: No variety. We have had enough of this throughout the last twelve months from the Government and their supporters, and we want no more of it.

Mr. Brewis: Mr. Brewis rose—

Mr. Buchan: This is the ninth intervention in a short speech.

Mr. Brewis: In view of what the hon. Member has said, will he say specifically that his party intends to abolish both grant-aided and independent schools?

Mr. Buchan: I said that we accept the recommendations of the Public Schools Commission that the grant-aided schools should be phased towards absorption in the State sector, and we are considering how best to do this. I emphasise the word "phasing" for the simple reason that some parents have sent their children in good faith to these schools and therefore it should be done gradually over a period of years.

Mr. MacArthur: What should be done gradually?

Mr. Buchan: I have told the hon. Gentleman. We have made successive statements on this at last year's Labour Party conference, and now from me.

Mr. MacArthur: Come clean.

Mr. Buchan: I have come clean, absolutely clean. We are going to work this through, and this is what will happen. Hon. Gentlemen had better start counting their coppers ; they may have to pay more for their fees.

Mr. MacArthur: What is to happen?

Mr. Buchan: You had better make up your mind.

Mr. William Ross: Tell him to read the report.

Mr. Buchan: Yes, I would ask the hon. Member for Perth and East Perthshire (Mr. MacArthur) to read the report. He must make up his mind that no longer are we to continue a system where half of the privileges are to be paid for by the; taxpayer.

Mr. MacArthur: Mr. MacArthur rose—

Mr. Buchan: If hon. Gentlemen want snobbery and privilege, they should be prepared to pay for them.
Our attitude has been hardened and reinforced by the behaviour of the present Government. The line they have taken throughout all our debates on the social services, education and everything else from the beginning has been the creation of two nations.

Mr. MacArthur: Mr. MacArthur rose—

Mr. Buchan: The hon. Member for Perth and East Perthshire has tried to interrupt me about seven times, and he still wants privilege. Well, I will give him the privilege this time by giving way.

Mr. MacArthur: The hon. Gentleman has given me much more than my fair share of interventions, but I am confused as to what it is he will do gradually over a period of years. Will he come clean and say whether it is his party's intention to abolish grant-aided schools in Scotland? This is what we want to know—will he tell us?

Mr. Buchan: This has been made very clear twice—most recently by my right hon. Friend the Member for Newcastle-upon-Tyne. Central (Mr. Edward Short)—for England and Wales.

Mr. MacArthur: Yes or no?

Mr. Buchan: We have the problem of working this out for Scotland. I am saying that over a period of years this is the way I would do it. [Interruption.] I will continue if hon. Gentlemen opposite will show an atom of politeness. The last Minister who spoke from the Government benches refused to give way, even after insulting my hon. Friend.

Mr. MacArthur: Be generous.

Mr. Buchan: It is not a question of being generous. Do not be so patronising. The gentlemen's party opposite fight for privilege and want to keep that privilege, but they now want other people to pay for it. [Interruption.] They sometimes have the manners of the farmyard.

Mr. MacArthur: Answer.

Mr. Buchan: I have said what will happen. The recommendation of the report was a successive phasing out—

Mr. MacArthur: What will the hon. Gentleman do?

Mr. Buchan: Shut up for a moment and I will tell you.

Mr. Deputy Speaker (Sir R. Grant-Ferris): Order. We must try to be a little quieter than we are. I am sure the hon. Member for Renfrew, West (Mr. Buchan) wants to give time for some other hon. Members to speak, and the more interventions there are the less chance of an opportunity for other hon. Members to participate.

Mr. Buchan: The recommendation has been made in the Report of the Public Schools Commission and we are now working out how best to carry it into effect. If hon. Gentlemen opposite want privilege, then they will have to be prepared to pay for it—and it is about time.

10.54 p.m.

Mr. Hugh D. Brown: It might be for the benefit of the House if a different voice is heard on educational matters.

Hon. Members: Hear, hear.

Mr. Brown: Hon. Gentlemen opposite had better relax because this does not mean that I am on their side. It is just that I thought my remarks might make the debate a little more interesting than were the continuous and protracted debates that took place on this subject earlier in the year.
I wish to ask the Minister one or two pertinent questions to which we are entitled to receive replies. I shall not go into the argument about who gave what and whether this is the same or less than the Labour Government gave. The general principle is that, as this is the first opportunity that the Under-Secretary has had in his official capacity, he will try to justify the present system. I am not arguing whether it is £1½ million or £2 million.
I should like to know what percentage of the pupils at the schools listed in the Regulations leave at 15 years of age compared with those who leave the ordinary State scheme? Has any estimate been made, because the hon. Gentleman has been under pressure from all the teaching organisations, if and when the


school-leaving age is raised, of the number of pupils from these schools who might be among those who go to further education centres? Has any projection been made of the impact that the raising of the school-leaving age will make on these schools? Have any of the schools in the Schedule suggested that they should have some comparable designation because they suffer from teacher shortage? Will the hon. Gentleman give us some information on the problems which they face concerning teachers?
Finally, have the Government given any consideration to the Report of the Public Schools Commission? The Minister will have plenty of time to get the information. It seems that hon. Gentlemen opposite are doing their own case a disservice. Two of the best suburban schools in or near Glasgow are Milngavie and Newton Mearns, neither of which is fee-paying. I am referring to Protestant schools. Why? Because both are modern, fully staffed, schools. This is what we should be aiming for. We should not be trying to justify a system of privilege which is quite out of date.

10.58 p.m.

Mr. Ian MacArthur: I am grateful to the hon. Member for Renfrew, West (Mr. Buchan) for his great courtesy in giving way to me so generously when I tried to interrupt him during his speech. I hope that I did not overdo it, but I was encouraged to interrupt because there were areas of uncertainty in his speech. I am sure that he will agree that it is important, in the name of democracy, that people in Scotland should know what the Labour Party has in mind concerning education.
I have been asking this question for some years now. The more answers I get the more confused I become, because the answers given by the hon. Gentleman and his colleagues are never clear. They live in muddy educational waters, and they seem muddier still with every reply that they give.
There is a great deal of uncertainty about the intentions of right hon. and hon. Gentlemen opposite for the future of the grant-aided schools. I have often spoken in debates about these schools and repeatedly asked whether the Labour Party intended to abolish them. I asked

that same question tonight. However, I have had no answer beyond being told that over a period of years various things might happen, that they could not be revealed completely now, but that they might be in line with the recommendation of the Public Schools Commission. I did not think that the recommendation of the Commission was crystal clear. There are many who might not agree with the findings of the Commission about education. I thought that it was a tendentious and questionable Report.
The grant-aided schools in Scotland are an important part of the variety of education that we have. The independent, grant-aided and fee-paying sector in Scotland is very much smaller than the equivalent sector south of the Border, but I believe that the balance in Scotland is just about right for our needs. And because it is small and just about right for our needs I view with the gravest suspicion any assault on this sector of education by the Labour Party which, because of dogma, or something equally undesirable, constantly gives the impression that what it wants in Scotland is one system in education, with no choice whatsoever for the parents.
I remind hon. Gentlemen opposite that many children at grant-aided schools are there because their fathers' occupations take them abroad. A boarding school is necessary for them, and it is not available in any sector other than the grant-aided one, because the father is often not in a position to pay the very much higher fees which an independent school has to charge.
I believe that the grant-aided schools in Scotland meet a very important social need and that it would be educationally wrong to abolish them, as I suspect hon. Gentlemen opposite wish to do, although they have not the strength of determination to come out and say so clearly to the Scottish people. They will not say it clearly because they know that grant-aided schools have a particular place in the affections of the people of Scotland who do not want to see them abolished.
Hon. Gentlemen opposite have been waging a steadily mounting campaign against the education system in Scotland. There was their assault on the local authority fee-paying schools in 1969. Mercifully we were able to retrieve that situation just the other day. Tonight we


have seen a resumption of their assault on the grant-aided schools.
I still ask what is the attitude of right hon. and hon. Gentlemen opposite to the independent schools in Scotland? I am sure that the hon. Gentleman is capable of giving a simple "Yes" or "No" answer to a simple question. Is it the intention of the Labour Party to abolish grant-aided schools, and soon after that to abolish the independent schools in Scotland? I often ask that question, but I am never given an answer, and I hate being in a position of uncertainty because I like giving clear answers to my constituents who ask these questions. I wish that the hon. Gentleman would help me to answer the questions that I am asked. Is it the Labour Party's intention to abolish grant-aided schools? Is it the Labour Party's intention to abolish independent schools?
I remind hon. Gentlemen opposite that a large sector of opinion in Scotland believes that the grant-aided schools contribute importantly to the pattern and variety of education in Scotland. That is a widely held view and is not confined to those whose children happen to go to these schools. I know that from my own experience. Many people feel that grant-aided schools play an important part in the Scottish education system.
The view that I have expressed about these schools is not simply mine or held only by those constituents who happen to have mentioned it to me. It is held by the Scottish Council. The hon. Gentleman knows the Scottish Council, and I am sure that he will have regard to its views. He often quotes what it says, and quite rightly, because it usually has wise things to say. One of the wisest things said by the Council was in a brochure directed at industrialists. It was a good brochure, as all these publications are, and one of the attractions to which the Council pointed for incoming industrialists was the variety and range of choice in Scottish education. If I remember aright, the Council specified the grant-aided schools and local authority fee-paying schools as particular attractions to the new, questing, zestful people whom we wish to attract to Scotland to help us to develop.
Yet these are the very schools which contribute so much to the educational scene in Scotland which the hon. Gentleman is trying to abolish. Perhaps he is

not. We are in this great difficulty, as are the people of Scotland. They want to know. This question has been asked for many years and I wish that the hon. Gentleman would give a straight answer. Are they to be abolished or not? The question has been asked four times tonight and we have had four answers which are no answers at all. We want to know "Yes" or "No". It is right that we should know. Above all, these schools are part of the variety of Scottish education.
A large part of the strength of education in Scotland is the variety it provides. Behind this there is a large philosophical question. In education we must provide a freedom of choice for parents. This one of the areas of freedom of choice. It comes very strangely from these egalitarians opposite that the grant-aided schools must go or be absorbed over a period of years. We heard from them quite clearly, in 1969 and this year, that they abhor the local authority fee-paying schools and those are the two areas clearly under direct threat. The hon. Gentleman has come clean on this one. We know that he wants to get rid of the fee-paying local authority school and I suspect that he wants to get rid of the grant-aided school.
He has not said anything about the independent schools yet. What the hon. Gentleman and his egalitarian friends are trying to do is to remove freedom of choice from the parent who is not well off and restrict freedom of choice to the very rich parent who can afford to pay fees at the expensive public schools at which hon. Gentlemen opposite like poking fun. This seems to be a most extraordinary doctrine of Socialism—to restrict choice to the very rich. I want to spread choice as widely as possible in Scotland. In the spreading of choice the grant-aided schools have an essential rôle. That is why I welcome the Regulations.
I welcome the fact that in this proposal the grant-aided schools will be assisted in a way which will take note of inflation. That is right. I welcome the Regulations and I am sorry that hon. Gentlemen should have opposed them and obstinately refused to give us their policy in this essential sector of education which provides the freedom and variety which we need so much.

11.3 p.m.

Mr. John Smith: I listened carefully to the hon. Member for Perth and East Perthshire (Mr. Mac-Arthur) to discover the reason for the perpetuation of the grant-aided system. We had a number of arguments, one of which was that there was a great deal of affection for them. That did not seem to be a very powerful educational argument. We had the argument of variety of pattern, but it seemed to me that the needle in the gramophone got stuck at that point. The hon. Gentleman went on to develop the point a little further. He was talking about individual freedom. He said that it gives a pattern of variety and a variety of pattern and the gramophone went round and round as the hon. Member warmed to one of his favourite themes.
He seems to have two enthusiasms in this House. One is the defence of private education and the other the relief from rates for horse-breeding establishments. He holds these causes dear to his heart and lavishes on them all the skill of a part time adman. He did not come to the central point of the debate which is the challenge we are making to the perpetuation of these schools.
Before leaving that point, I will deal with the rather unfortunate method the Government are using in putting forward figures in these Regulations. They were apparently in use several years ago. There is in the Regulations power for the Secretary of State to make a substantial increase, as he thinks fit. What the Government are doing is putting a base line for their expenditure but not telling us how far they will go beyond the base line. In effect the Secretary of State is asking for a blank cheque from Parliament for the amount he may give the fee-paying schools. It would have been better if he had made a calculation going back to 1969 and come forward with actual figures that it is proposed to give to fee-paying schools. We could then have compared those statistics with the other figures he mentioned, such as the saving that will supposedly be made on school milk and so on. We might then have been able to make a true comparison.
I suspect that as soon as Parliament is misguided enough to give the Secretary of State the powers he is seeking

he will see to it that his friends in the grant-aided schools get more than £1½ million. If there is anything in all this talk about the need for variety, why must it always be accompanied by talk of finance? In other words, why must there be a financial barrier of this kind in the education system? Why cannot we have grant-aided schools that do not charge fees? Is Marr College not a good example? Is that the sort of pattern the hon. Member for Perth and East Perthshire has in mind? I suggest that the enthusiasm that is shown by hon. Gentlemen opposite for these schools would soon dwindle if fees were not involved.
It is interesting also to note that these schools are located, in the main, in Glasgow and Edinburgh. It seems strange that if variety is so important in this respect it has not been taken up by other areas. [Interruption.] I gather that the moans of hon. Gentlemen opposite are designed to indicate that fee-paying schools have been established in the odd other locality, but by and large they are in the central belt.
I doubt whether the hon. Member for Perth and East Perthshire goes galloping round his constituency advocating the establishment of fee-paying schools here, there and everywhere. In any event, I wonder if he advocates that in one breath and in the next discuss the relief of rates for horse breeding establishments with his constituents?
The Public Schools Commission dealt with this problem some time ago. When the hon. Member for Perth and East Perthshire was casting around for support for his case, he mentioned the Scottish Council. That caused my hon. Friends some wonderment. For example, my hon. Friend the Member for Glasgow, Wood-side (Mr. Carmichael) thought he was referring to the Scottish Council of the Labour Party.
It was a far cry from education for the hon. Gentleman to call in aid an organisation which is responsible for the development of industry. One would have imagined that he would have preferred to quote the experts who formed the Public Schools Commission. [Interruption.] They were experts, and I suspect that hon. Gentlemen opposite are interrupting without even knowing who sat on that Commission. The Chairman


was Mr. T. Ewan Faulkner, a former convener of Dundee Education Committee, and the Vice-Chairman was Mr. Roger Young, Headmaster of George Watson's College, Edinburgh. The other members included a former headmaster and the director of education for Midlothian, not to mention a principal of a college of education. The only person who might be said to have had any Left-wing leanings was a former hon. Member of this House. I notice that once hon. Gentlemen opposite are told the facts they interrupt no longer. The Public Schools Commission reported :
It is easy to plead generally for variety in education, but concerned as we are about the total education system should aim to provide variety within the comprehensive system rather than attempt to reconcile what is in educational and social terms ultimately irreconcilable, the continuation of a minority of selective schools in an otherwise comprehensive pattern.
Earlier the Commission reported :
The stratification of schools is inevitably at the expense of the comprehensive schools and of the education of the young people in them : this seems to us to be well illustrated in the evidence they received about the situation in Edinburgh.
We all know that no city has a worse educational stratification than Edinburgh. There are five different types of school in Edinburgh : comprehensive schools, local authority selective schools, local authority fee-paying schools, grant-aided schools and independent schools. It is the most elaborate pecking order that one could devise for an educational system.
As someone who lives in Edinburgh, I can say that this system causes great dismay throughout the city. I counsel the Conservative Party to be careful about what they are doing. They are the representatives of a dwindling minority of people. The majority of parents are beginning to realise the need to support the State education system. The Conservative Party ought to think a little wider than this and get out of the Perthshire syndrome of politics and think about their future, because increasingly parents are becoming less tolerant about the inequalities and absurdities existing in these direct grant schools.
One does not object to the schools themselves but to the fact that a fee has to be paid for entry to them. Why that is necessary I do not know. If we were starting from scratch, not one Member of

the House would argue that we should introduce fees into our education system. Hardly any Members of the House would claim that in another 15 years we will still have fees. Progress towards comprehensive education is going apace. It even has converts within the Conservative Party. Why should we have to suffer this interregnum and perpetuate, during that period, the inequalities and injustices that fall from the present system?
It is a pity that the people who do not realise the harm done by these things are trying to fight off the inevitable. I hope that we shall reach a situation when we will not have these distortions in our education system, either with fee-paying or direct grant schools, annd that the whole of Scotland will have the freedom of choice that the people of Perth have but those of Edinburgh do not have.

11.17 p.m.

The Under-Secretary of State for Health and Education, Scottish Office (Mr. Edward Taylor): This has been an astonishing debate because the Regulations are simple in their purpose and objective. As with every subject, when we hear the hon. Member for Lanarkshire, North (Mr. John Smith), and particularly the hon. Member for Renfrew, West (Mr. Buchan), I feel that if we were discussing land drainage Regulations or a hill sheep Order they would find the class war inherent in them.
But these Regulations are not about a class war. This is a simple procedure to bring up to date the Regulations introduced by the previous Administration in 1969, freezing the grants for grant-aided schools and to take account of rises in prices and costs. That is all that we are doing ; nothing more. We are taking account of the inflation which occurred under the previous Government and the inflation which is temporarily occurring under this Government.
We have heard hon. Members opposite fighting the class war. The hon. Member for Lanarkshire, North, had several rich arguments. I am afraid that the hon. Member for Renfrew, West, has had a busy day and has not even read what the Regulations are for. He asked why we have the same figure as we had in the previous Regulations. He said that this was a trick by the Tories to try to pinch money from their supporters. But what


we are doing is simply using this as the base and, on that base, we will have a percentage increase to take account of increased costs.

Mr. Buchan: As always, the hon. Gentleman has totally misunderstood the reason why I was surprised at the same figure being there. That is because of the hon. Gentleman's speech two years ago, when he said that the figure was spiteful. mean and inadequate. He is saying now that they are exactly the same.

Mr. Taylor: It was absolutely spiteful, mean and miserable, because what hon. Gentlemen opposite were doing was freezing the grants for good, thinking that they would create a situation in which costs would soar and fees would soar as a consequence.
The school year begins on 15th May, and we have based our calculation on the increase between October, 1969, and April, 1971, in costs incurred in such a school. The main such costs are teachers' salaries and other relevant costs such as heating, lighting and cleaning. Much of the relevant information on these is already available in connection with the calculations needed for R.S.G., and our provisional calculations suggest that relevant costs have increased by about 20 per cent.
We shall be writing to the schools shortly to inform them of the exact amount by which their grant will be increased. It would not be appropriate to set out revised amounts in Regulations, as this would again mean that we would be facing a situation which did not allow for an increase in the cost of living. We are bringing this up to date to take account of the increase in the cost of living.

Mr. Bruce Millan: Is the percentage increase to be applied to every school, or are there to be individual percentage increases for individual schools?

Mr. Taylor: I will deal with that in detail later. By and large it will take account of the increases as a whole, and we expect that 20 per cent. will be a rough figure. There is provision in the Regulations for going ahead from that.
We have had some other questions. The hon. Member for Renfrew, West said

that we were giving more money to the grant-aided schools and taking it from poor children. He talked about how there was an increase in the percentage of free school meals because of an increase in poverty. The hon. Gentleman must know that we have an increase in free school meals because there has been an increase in the exemption limits. In other words, we have made it possible for a wider range of people to be eligible for free school meals, which is part of the policy of this Government of ensuring that we give help where it is needed.

Mr. Buchan: Mr. Buchan rose—

Mr. Taylor: This must be the last time.

Mr. Buchan: I gave way 11 times. This is on the question of exemptions. The number of free school meals remains a factor of poverty. The point about exemptions is to deal with the inflation and the rise in prices. The poverty factor remains the same. The hon. Gentleman must understand that.

Mr. Taylor: I try to understand what the hon. Gentleman says from time to time, but I regret to say that I do not always succeed, and I do not think that I am entirely alone in feeling this.
What about the justification for the Regulations? We honestly believe that there is a very real case for variety in education in Scotland. We think that excellence in education is more likely to result where there are different kinds of schools free to develop there own systems along their own lines. The hon. Member for Renfrew, West says, "Let us do away with these grants. Let us not have the Regulations." We would then have the ridiculous situation in which, as my hon. Friend the Member for Perth and East Perthshire (Mr. MacArthur) said in his excellent speech, there would not be freedom of choice for a large range of people in Scoland ; there would be freedom of choice only for the rich. It seems that this is the situation which the hon. Gentleman and his friends are trying to create.
The amending Regulations still operate on the basis of the 1969 "frozen grant" Regulations, not because we necessarily believe that these are the best and fairest way of disbursing central Government money to the schools, but because we


agree with the previous Government that it is sensible to give careful consideration to the future basis of grant to these schools ; and we do not intend to make any fundamental change in the present arrangements until this consideration has been completed.
We have had discussions with the governors of the schools. We are looking forward to hearing from them and at a later stage we shall be bringing forward our long-term proposals. We shall take careful account of some valuable points made by the hon. Member for Glasgow, Provan (Mr. Hugh D. Brown), who asked me a particular point about the percentage of those staying on at the various schools. The most up-to-date figures I have are those for 1968. These figures are taken from page 48 of the Second Report of the Public Schools Commission. Those who left at under 17 years of age, at 17 and 18 or over, were in the various categories 33 per cent., 55 per cent. and 12 per cent. for grant-aided schools and the corresponding figures for education authority schools are 84 per cent., 13 per cent. and 3 per cent. respectively.
Then the hon. Member for Renfrew, West presented the argument about this devasting report which condemned these schools and suggested that we should abolish them. The hon. Members for Lanarkshire, North and for Renfrew, West made several quotations from the Report, their suggestion being that here we have a splendid independent assessment by experts in education who, having approached this matter with an open mind, said. "We must do away with the schools".
I wonder whether those hon. Members, in their careful consideration of what was said, looked at the question which was put to the Commission. Was it asked to have an open mind? Was it asked to look at the whole system and say what could best be done with these schools? Not at all. The hon. Member for Lanarkshire, North knows quite well what the Commission was asked to do. Here are the terms of reference :
To advise on the most effective method or methods"—
I emphasise those words—
by which direct grant … schools in England and Wales and the grant-aided schools in

Scotland can participate in the movement towards comprehensive reorganisation …".
That was the question. The Commission was not—

Mr. John Smith: And, in the course of that consideration, the Commission came to the conclusion, in enthusiastic terms, that
the consequent stratification of schools is inevitably at the expense of comprehensive schools and of the education of the young people in them".
It is obvious that the members of the Commission started with their remit, but they ended up as enthusiastic converts to getting rid of fees.

Mr. Taylor: If I were asked to take part in a Commission to try to encourage the consumption of alcohol in primary schools, I might well be rather reluctant to do so, being a sensible person and an office holder in the Band of Hope.
It is scandalous that the hon. Members for Renfrew, West and for Lanarkshire, North, with their other hon. Friends, have tried to mislead the public and other hon. Members who may not know the truth into thinking that we had here an independent Report in the way they described, when, in fact, the Commission was asked to look at these schools and see how they might be brought into the comprehensive system. The Commission did not come to the kind of conclusion that has been alleged, and the Opposition's attempt to make that point is an indication of the disgraceful level to which they have brought this debate.
I have been asked about the future. I have said that it is the Government's intention, because of the consultations we have had, to ensure that we give careful consideration to the future basis for grant and how it might be distributed. Hon. Members may wonder how long these interim Regulations are intended to last and when it is hoped to bring in a new long-term system of grant aid for schools. As I have said, we have had talks with representatives of the schools. We have asked them to let us have their views on, the arrangements for central Government grant for the schools, and, when they have completed their study of the matter, they will, I know, let us have their recommendations as soon as possible. The Government will then consider these recommendations most carefully in the


light of what is practicable. I hope that we can arrive at a satisfactory solution for the long term within, perhaps, a year.

Mr. Millan: Mr. Millan rose—

Mr. Taylor: There are only two minutes left.

Mr. Millan: Has the Minister discussed this with the Scottish local education authorities?

Mr. Taylor: I hope that we can arrive at a satisfactory solution. Our aim will be to get it right. In the meantime, these Regulations, unlike the frozen grant Regulations which they replace, will genuinely hold the position, and could do so more or less indefinitely.
We are not introducing a new principle here. We are not taking £1½ million and giving it where it was not given before.

Mr. George Lawson: From what source is the Minister getting advice?

Mr. Taylor: The hon. Member for Motherwell does not understand these things. I challenge him and all his hon. Friends to let us know their views. Our views are clear, and they have been clearly stated. The Opposition want to strangle the grant-aided schools. They are trying, in effect, to create a situation in which freedom of choice is available only for the rich. That is what they stand for.
By these Regulations, we are simply holding the position. The Opposition have behaved scandalously, they have failed to say what their own policy is, and I ask the House to reject the Motion with contempt.

Question put :—

The House divided : Ayes 155, Noes 185.

Division No. 425.]
AYES
[11.30 p.m.


Archer, Peter (Rowley Regis)
Ford, Ben
McCartney, Hugh


Armstrong, Ernest
Forrester, John
McElhone, Frank


Ashton, Joe
Freeson, Reginald
McGuire, Michael


Atkinson, Norman
Garrett, W. E.
Mackenzie, Gregor


Bagier, Gordon A. T.
Gilbert, Dr. John
Maclennan, Robert


Bennett, James (Glasgow, Bridgeton)
Ginsburg, David
McMillan, Tom (Glasgow, C.)


Bishop, E. S.
Gelding, John
McNamara, J. Kevin


Blenkinsop, Arthur
Gourlay, Harry
Mahon, Simon (Bootle)


Boardman, H. (Leigh)
Grant, George (Morpoth)
Mallalieu, J. P. W. (Huddersfield, E.)


Booth, Albert
Grant, John D. (Islington, E.)
Marsden, F,


Brown, Hugh D. (G'gow, Provan)
Hamilton, William (Fife, W.)
Marshall, Dr. Edmund


Brown, Ronald (Shoreditch &amp; F'bury)
Hamling, William
Mason, Rt. Hn. Roy


Buchan, Norman
Hannan, William (G'gow, Maryhill)
Mellish, Rt. Hn. Robert


Buchanan, Richard (G'gow, Sp'burn)
Hardy, Peter
Millan, Bruce


Campbell, I. (Dunbartonshire, W.)
Harper, Joseph
Miller, Dr. M. S.


Cant, R. B.
Harrison, Walter (Wakefield)
Milne, Edward (Blyth)


Carmichael, Neil
Hart, Rt. Hn. Judith
Mitchell, R. C. (S'hampton, Itchen)


Carter, Ray (Birmingham, Northfield)
Healey, Rt. Hn. Denis
Molloy, William


Clark, David (Colne Valley)
Hooson, Emlyn
Morgan, Elystan (Cardiganshire)


Cocks, Michael (Bristol, S.)
Horam, John
Morris, Rt. Hn. John (Aberavon)


Cohen, Stanley
Howell, Denis (Small Heath)
Murray, Ronald King


Concannon, J. D.
Huckfield, Leslie
O'Malley, Brian


Conlan, Bernard
Hughes, Mark (Durham)
Oswald, Thomas


Cox, Thomas (Wandsworth, C.)
Hughes, Robert (Aberdeen, N.)
Owen, Dr. David (Plymouth, Sutton)



Hunter, Adam
Palmer, Arthur


Cunningham, G. (Islington, S. W.)
Irvine, Rt. Hn. Sir Arthur (Edge Hill)
Parry, Robert (Liverpool, Exchange)


Dalyell, Tam
John, Brynmor
Pendry, Tom


Davidson, Arthur
Johnson, James (K'ston-on-Hull, W.)
Pentland, Norman


Davies, Denzil (Llanelly)
Johnson, Walter (Derby, S.)
Perry, Ernest G.


Davies, G. Elfed (Rhondda, E.)
Johnston, Russell (Inverness)
Prescott, John


Davies, Ifor (Gower)
Jones, Barry (Flint, E.)
Price, William (Rugby)


Davis, Clinton (Hackney, C.)
Jones, Gwynoro (Carmarthen)
Probert, Arthur


Davis, Terry (Bromsgrove)
Jones, T. Alec (Rhondda, W.)
Reed, D. (Sedgefield)


Deakins, Eric
Kaufman, Gerald
Recs, Merlyn (Leeds, S.)


Dempsey, James
Kerr, Russell
Rhodes, Geoffrey


Dormand, J. D.
Kinnock, Neil
Roberts, Albert (Normanton)


Douglas, Dick (Stirlingshire, E.)
Lambie, David
Robertson, John (Paisley)


Duffy, A. E. P.
Lamond, James
Roderick, CaerwynE.(Br'c'n&amp;n'dnor)


Eadie, Alex
Latham, Arthur
Roper, John


Edelman, Maurice
Lawson, George
Ross, Rt. Hn. William (Kilmarnock)


English, Michael
Leadbitter, Ted
Sillars, James


Evans, Fred
Leonard, Dick
Skinner, Dennis


Faulds, Andrew
Lewis, Ron (Carlisle)
Smith, John (Lanarkshire, N.)


Fernyhough, Rt. Hn. E.
Lomas, Kenneth
Spearing, Nigel


Fisher, Mrs. Doris (B'ham, Ladywood)
Loughlin, Charles
Spriggs, Leslie


Fletcher, Ted (Darlington)
Mabon, Dr. J. Dickson
Stallard, A. W.


Foley, Maurice
McBride, Neil
Steel, David




Stoddart, David (Swindon)
Weitzman, David
Wilson, William (Coventry, S.)


Strang, Gavin
Wells, William (Walsall, N.)
Woof, Robert


Taverne Dick
White, James (Glasgow, Pollok)



Thomson, Rt. Hn. G. (Dundee, E.)
Whitehead, Phillip
TELLERS FOR THE AYES :


Urwin, T. W.
Whitlock, William
Mr. James A. Dunn and


Varley, Eric G.
Wilson, Alexander (Hamilton)
Mr. James Hamilton.


Wainwright, Edwin






NOES


Adley, Robert
Green, Alan
Normanton, Tom


Alison, Michael (Barkston Ash)
Grylls, Michael
Nott, John


Allason, James (Hemel Hempstead)
Gummer, Selwyn
Osborn, John


Amery, Rt. Hn. Julian
Hall, Miss Joan (Keighley)
Owen, Idris (Stockport, N.)


Atkins, Humphrey
Hall, John (Wycombe)
Page, Graham (Crosby)


Awdry, Daniel
Hall-Davis, A. G. F.
Page, John (Harrow, W.)


Baker, Kenneth (St. Marylebone)
Harrison, Col. Sir Harwood (Eye)
Parkinson, Cecil (Enfield, W.)


Baker W. H. K. (Banff)
Haselhurst, Alan
Pink, R. Bonner


Benyon, W.
Havers, Michael
Pounder, Rafton


Berry, Hn. Anthony
Hay, John
Powell, Rt. Hn. J. Enoch


Biffen, John
Hayhoe, Barney
Proudfoot, Wilfred


Biggs-Davison, John
Hicks, Robert
Pym, Rt. Hn. Francis


Boardman, Tom (Leicester, S. W.)
Higgins, Terence L.
Redmond, Robert


Boscawen, Robert
Hill, James (Southampton, Test)
Reed, Laurance (Bolton, E.)


Bowden, Andrew
Holland, Philip
Rees, Peter (Dover)


Boyd-Carpenter, Rt. Hn. John
Holt, Miss Mary
Renten, Rt. Hn. Sir David


Bray, Ronald
Hornby, Richard
Rhys Williams, Sir Brandon


Brewis, John
Hornsby-Smith, Rt. Hn. Dame Patricia
Roberts, Michael (Cardiff, N.)


Brinton, Sir Tatton
Howell, David (Guildford)
Rossi, Hugh (Hornsey)



Howell, Ralph (Norfolk, N.)
Russell, Sir Ronald


Brocklebank-Fowler, Christopher
Hunt, John
Scott, Nicholas


Brown, Sir Edward (Bath)
Hutchison, Michael Clark
Shaw, Michael (Sc'b'gh &amp; Whitby)


Bruce-Gardyne, J.
James, David
Shelton, William (Clapham)


Buchanan-Smith, Alick (Angus, N&amp;M)
Jenkin, Patrick (Woodford)
Simeons, Charles


Buck, Antony
Kilfedder, James
Skeet, T. H. H.


Burden, F. A.
Kimball, Marcus
Smith, Dudley (W'wlck &amp; L'mington)


Butler, Adam (Bosworth)
King, Tom (Bridgwater)
Soref, Harold


Carlisle, Mark
Kinsey, J. R.
Speed, Keith


Channon, Paul
Kitson, Timothy
Spence, John


Chataway, Rt. Hn. Christopher
Knox, David
Sproat, Iain


Churchill, W. S.
Lambton, Antony
Stanbrook, Ivor


Clarke, Kenneth (Ruohcliffe)
Legge-Bourke, Sir Harry
Stodart, Anthony (Edinburgh, W.)


Cooke, Robert
Le Marchant, Spencer
Stoddart-Scott, Col. Sir M.


Coombs, Derek
Longden, Gilbert
Stokes, John


Cooper, A. E.
Luce, R. N.
Sutcliffe, John


Corfield, Rt. Hn. Frederick
MacArthur, Ian
Taylor, Edward M.(G'gow, Cathcart)


Cormack, Patrick
McCrindle, R. A.
Taylor, Frank (Moss Side)


Critchley, Julian
McLaren, Martin
Tebbit, Norman


Crouch, David
McNair-Wilson, Michael
Thomas, John Stradling (Monmouth)


Crowder, F. P.
McNair-Wilson, Patrick (New Forest)
Thomas, Rt. Hn. Peter (Hendon, S.)


Curran, Charles
Madel, David
Trafford, Dr. Anthony


Davies, Rt. Hn. John (Knutsford)
Mather, Carol
Trew, Peter


Dean, Paul
Mawby, Ray
Tugendhat, Christopher


Deedes, Rt. Hn. W. F.
Maxwell-Hyslop, R. J.
Turton, Rt. Hn. Sir Robert


Drayson, G. B.
Meyer, Sir Anthony
Waddington, David


Dykes, Hugh
Mills, Peter (Torrington)
Walder, David (Clitheroe)


Eden, Sir John
Miscampbell, Norman
Walker, Rt. Hn. Peter (Worcester)


Elliot, Capt. Walter (Carshalton)
Mitchell, Lt.-Col. c.(Aberdeenshire, W)
Ward, Dame Irene


Elliott, R. W. (N'c'tle-upon-Tyne, N)
Mitchell, David (Basingstoke)
Warren, Kenneth


Eyre, Reginald
Moate, Roger
Weatherill, Bernard


Farr, John
Molyneaux, James
Wells, John (Maidstone)


Fenner, Mrs. Peggy
Money, Ernle
Whitelaw, Rt. Hn. William


Fidler, Michael
Monks, Mrs. Connie
Wilkinson, John


Finsberg, Geoffrey (Hampstead)
Monro, Hector
Wolrige-Gordon, Patrick


Fisher, Nigel (Surbiton)
Montgomery, Fergus
Wood, Rt. Hn. Richard


Fookes, Miss Janet
More, Jasper
Woodnutt, Mark


Fortescue, Tim
Morgan, Ceraint (Denbigh)
Worsley, Marcus


Fox, Marcus
Morrison, Charles (Devizes)
Wylie, Rt. Hn. N. R.


Galbraith, Hn. T. G.
Mudd, David
Younger, Hn. George


Gilmour, Ian (Norfolk, C.)
Murton, Oscar



Gilmour, Sir John (Fife, E.)
Nabarro, Sir Gerald
TELLERS FOR THE NOES :


Goodhew, Victor
Neave, Airey
Mr. Waiter Clegg and


Cower, Raymond
Nicholls, Sir Harmar
Mr. Paul Hawkins.


Grant, Anthony (Harrow, C.)
Noble, Rt. Hn. Michael

HOUSING BILL

Considered in Committee [Progress, 9th July].

[Sir Robert Grant-Ferris in the Chair]

Clause 2

INCREASE IN FINANCIAL ASSISTANCE

Amendment proposed : No. 15, in page 2, line 35, to leave out '75' and insert '90'.—[Dr. Dickson Mabon.]

Question again proposed, That the Amendment be made.

11.40 p.m.

Dr. J. Dickson Mabon: I remind hon. Members that with this Amendment we are discussing the following :

Amendment No. 16, in page 2, line 36, at end insert—
Section 6(2) (Limit on amount of One half improvement grant payable in advance)
'75 per cent.'.

Amendment No. 18, in page 2, line 37, leave out '75' and insert '90'.

Amendment No. 19, in page 2, line 40, leave out '75' and insert '90'.

Amendment No. 23, in page 4, line 13, leave out '75' and insert '90'.

Amendment No. 24, in page 4, line 15, leave out '75' and insert '90'.

Amendment No. 25, in page 4, line 24, leave out '75' and insert '90'.

The last three are consequential.

On Friday, I was in the middle of a most placatory passage asking the Minister to respond to our suggestions and that of his right hon. Friend the Secretary of State for the Environment.

Today's announcement about housing policy on top of the Bill means that we have much more to debate later with the Housing Bill which is to come next year. We shall be able to take up problems which we cannot remedy now. I am sure that after a rest at the weekend the Minister feels refreshed enough to reply.

The Minister for Housing and Construction (Mr. Julian Amery): When we concluded our debate in the rising temperature of a Friday afternoon in July, a number of hon. Members wanted me to deal with further matters relating to the Amendment. I will do my best to

meet their request for additional information as far as I can. I have studied what was said in the debate.
The purpose of the Amendment is to raise from 75 per cent. to 90 per cent. the amount of Exchequer contribution to the cost of the discretionary grants in the improvement areas. My argument on this similarly applies to later Amendments which will deal with standard and special grants.
I take it from what the hon. Member for Greenock (Dr. Dickson Mabon) said on Friday that this is essentially a probing Amendment. He asked whether the Government could spend all the money in the time available. I was asked how the estimate of £46 million was reached and how we expected it to be taken up. It may be useful if I explain what the figure—£31 million for England and Wales and £15 million for Scotland—represents.
It is not an estimate of Government expenditure. The £46 million mentioned in the Financial Memorandum is a forecast—there is a difference between a forecast and an estimate—of what additional capital expenditure might be incurred by local authorities on making capital grants to private owners and by local and other public authorities carrying out improvement works on houses they own. In the words of the Financial Memorandum, the figure is the best estimate that could be made of the effect of the Bill on capital expenditure of the kind I have described, assuming a good response by public authorities and private owners to the increased inducements. We will certainly do our best to encourage a good response, but whether the increase in public capital investment reaches it, or exceeds it, is no more within the direct control of the Government than are many other forecasts of public sector capital investment on other functions discharged not by Government, but by public bodies or private persons.
We hope that there will be an increase in improvement work to produce that level of additional investment. We shall encourage it in every way we can. We shall be happy if we have underestimated, but we cannot guarantee what the out-turn will be. I repeat, however, that we regard it as additional to the figures for public sector capital investment for housing as a whole contained in


the January White Paper. Nor will there be any difficulty if the take-up of grants turns out to be better than estimated and the capital investment figure correspondingly higher.
11.45 p.m.
In considering the estimate, I think some misunderstanding may have arisen from a reference early in our debate to the £22 million as expenditure on improvement grants over the whole country in 1970. In fact, in broad terms, the total public capital expenditure of the kind I have described for grant-aided improvement work by all agencies approved in England and Wales in 1970 was about £75 to £80 million and about £13 million in Scotland. I have gone out of my way to describe what the £46 million relates to in terms of capital expenditure by the public authorities, but, of course, there will also be additional expenditure by the Government.
The Government contributions will increase because the grants on which they are calculated will increase ; because the proportion will increase, and because the local authorities will get higher contributions. Based on the same assumptions as to take-up of the special inducements, the extra Government vote-borne expenditure could amount to about £5 million a year by 1973–74—£3·5 million for England and Wales and £1·5 million for Scotland. That is a continuing annual payment for the period of payment of the contributions.
It might be useful to set all these figures against a background of progress in 1970. I take up here a point raised by the hon. Member for Willesden, East (Mr. Freeson). In that year, there were about 157,000 approvals in England and Wales. About 42,000—or 27 per cent.—went to local authorities for converting and improving their own properties. About 33,400 were for improvement contributions, which are for conversions and improvements to a comparatively high standard. About 8,500 were for standard contributions to local authorities for providing the basic amenities. Local authorities have also approved about 114,000 grants to private owners—about 54,000 discretionary grants, 60,000 standard grants and 300 special grants. Out of the total of 114,000, over 4,000 were for housing associations.
Hon. Members have expressed interest in the breakdown of the private grants between owner-occupied houses and other houses. The answer here is that about 73,300 of the private grants approved in 1970 were for owner-occupiers and about 37,300 for rented houses—about 33 per cent. excluding the housing association houses. In Scotland, grant-aided improvements of 23,400 houses were approved in 1970. Of these, about 17,500 were for improvement of local authority houses, about 5,850 for private owners, and 46 for housing associations. Of the grants to private owners, about 4,300—or 81 per cent.—were for owner-occupied houses. Taking standard grants alone, the proportion of owner occupation was about 89 per cent.
The hon. Member for Shoreditch and Finsbury (Mr. Ronald Brown) also asked if the increase from 50 per cent. to 75 per cent. was a straightforward financial incentive, and why we had chosen that figure. The answer is that we wanted to encourage more improvement work in the development and intermediate areas over the next two years.
I can claim no more scientific authority for the 75 per cent. than the noble Lord, Lord Greenwood, could claim for his 50 per cent., introduced in 1969. It has no more special merit than that it is significantly higher than the present figure ; that it reduces the amount the owner has to find out of his own pocket ; but that it leaves him with a reasonable stake in the financing of the work.
Hon. Members may also have had in mind the question, why not a differential level grant for different categories of applicant? I think the answer to this is simply that we wanted more improvement, and the whole aim of the improvement grant scheme is to improve the condition of the whole housing stock.
From the beginning of the scheme, through successive Acts by successive Governments, grant has been determined by reference to the same maximum proportion of cost and the same cash limit, whether the house being improved was owner-occupied or rented. Equally, since standard grants were introduced in 1959, the 50 per cent. maximum proportion of cost has applied in all cases. We want more improvement by all agencies and of all categories. We certainly want to see more improvement of rented houses.


But we believe that an increase in grant across the board is the answer. We are offering increased inducements to landlords, owner-occupiers and public authorities alike.

Dr. Dickson Mabon: Does the right hon. Gentleman's remark that he has no scientific evidence one way or the other mean that the Department and the Scottish Office did not carry out any samples of possible repercussions if the grant was raised to our figure instead of the Government's figure? Local authorities behave differently from private individuals and owner-occupiers behave differently from private landlords. If there is no evidence, I rest content ; I am only sorry that there is not. But if there is evidence I should like to know about it.

Mr. Amery: As much evidence as is available to us in the housing statistics is available to the hon. Gentleman. But in arriving at the figure of 75 per cent., I do not think we had anything more scientific than the hon. Gentleman's right hon. and noble Friend, Lord Greenwood, had when he proclaimed the figure of 50 per cent. in 1969, and that was, after all, a development of housing improvements Acts which were introduced by Mr. Aneurin Bevan as far back as 1949.
Reference was made by the hon. Member for Shoreditch and Finsbury to the rising costs of improvement and to whether the size of the grant took account of this. He also referred to what he said was an answer to a recent Parliamentary Question to the effect that the cost of building a house had risen in the last 12 months by £1,180 and to the implications of this for the estimated extra public capital expenditure of £46 million, which is, of course, calculated at present prices.
On the best figures at present available, the average cost of construction of all dwellings in tenders approved for local authorities rose from £3,012 in the last quarter of 1969 to £3,136 in the last quarter of 1970—an increase, not of £1,100, but of £124. However, the grant is calculated as a percentage of the cost of the work, so no problem arises on this point. The amount of the cash limits is relevant but these are to be raised by

administrative action by £1,500 and £1,800 respectively. This can be done for particular cases or particular classes of case under Section 5(3) of the 1969 Act. The average discretionary improvement grant for applications approved for private owners during the first quarter of 1971 was only £517 compared with the maximum of £1,000.
The hon. Member for Shoreditch and Finsbury also raised the question whether the increase in the Government contribution to the costs of environmental improvement in a general improvement area represented an incentive value or a real attempt by me to look at the environmental grant, and he made the valid point that the success of housing improvement policy depends on a successful area improvement policy. He was in fact pressing that the existing limit of £100 a house to expenditure on environmental improvement in a general improvement area on which a Government contribution may be paid should be increased. This raises a much wider general issue.
We have not attempted in this Bill, limited to development and intermediate areas, to do more than increase the contribution to the costs of environmental improvement in parallel with the increased contribution made towards house improvement. The £100 per house cost limit is not a limit to which local authorities may spend on environmental improvement in a general improvement area ; it is in effect the formula on which the Government contribution is calculated.
Inquiries made by the Department earlier this year do not suggest that this limit is causing any general hold-up in progress with environmental improvement. But, as the hon. Member for Shoreditch and Finsbury has pointed out, the importance of improving the environment of residential areas is an integral part of Government policy and a close watch is being kept on the point. An increase in this last limit can, if required, be made by the Secretary of State by order.
The hon. Member for Greenock asked why, if the Government were conducting a publicity campaign about raising grants, they did not have a unit in the Department monitoring the rate at which these applications came in. The Department


already keeps track of progress with house improvement through the returns of applications approved and the other statistical material about house improvement grants and contributions provided in returns by local authorities and published regularly in summary form in the housing statistics.
I shall seek to obtain separate returns from the local authorities to which the Bill applies in respect of the higher rates of grants. It is not claimed that these will show precisely the take-up, for reasons which I tried to explain at our last Sitting. They are, for example, based on numbers of applications approved and take no account of applications which are not proceeded with. But they will provide a reasonably good indication of what is happening, sufficient certainly to gauge whether the take-up in these areas has been materially increased following the provision of higher grants.
I do not know whether I have been able in these few words to answer all the points raised by hon. Gentlemen opposite on the last occasion, but I have done my best to clarify those points which I could.

Mr. Reginald Freeson: We appreciate the effort which has been put in by the Minister and his Department during the time lapse since our last debate in obtaining information in answer to points which were raised. There are one or two matters outstanding which I will put to the Minister to see whether it is yet possible to get the information we seek.
Before doing so, I make the general observation that the tone in which the Minister has referred to this general figure of £46 million forecast expenditure is somewhat different from the manner in which the whole issue was presented to the public and to the Press a few weeks ago, when Press correspondents were told that the Government were giving an extra £46 million to the development of the intermediate areas. A different tone has crept in this evening, and it now becomes a question of expressing hope rather than estimating what the Government will be spending.
The Minister has referred to the £46 million as the most accurate estimate the Government can make of the rise in

Government expenditure as a result of the Bill. Will this be entirely Government expenditure, or will part of the £46 million be attributable to rate expenditure by local authorities? If so, what is that figure? There has been sufficient warning of this question. I have, I think, put it in Committee but, if not, I certainly put it on Second Reading.
I ask again a question I put on Second Reading and repeated last Friday. What is the current expenditure prior to the Bill becoming operative? When the 1969 Bill was going through Parliament the Financial Memorandum forecast that the annual public expenditure arising from that Bill would approach £40 million by 1972. We are half-way to 1972 now, and we should like to know whether this is still a realistic figure to which this £46 million spread over three years is to be added as the most accurate forecast that can be made, or is there a different figure? To what is the £46 million extra? This information is necessary if we are to be able fully to follow the effectiveness of the improvements policy. The Government have not so far published information on this matter and we are entitled to know.
12 midnight
My researches in the Library and elsewhere show that in 1971 the figure is expected to run at about £22 million, which is a good deal lower than the original £40 million forecast in 1969. Is this figure correct? Again we should know the answer to this question because this is the base on which the Bill is to operate.
It is important when examining these large amounts of public expenditure to try to get clearly in mind in what way this sum is extra to existing forecast expenditure generally on housing, because improvements are only one element in the public expenditure figure. In January the White Paper forecast public expenditure on housing in all its various forms to be £1,144.4 million. That figure was not broken down into its various elements. May we be told whether current expenditure is running on this pattern, or are there any indications of a fall-back? Will we be current spending at the rate of £1,144.4 million in 1971, or will we be under-spending in the public sector of housing? Is the £46 million spread out over three years additional


to the £1,144.4 million, or is it part of that figure within the original ceiling?
The Minister has said that in terms of forecasting there will be no difficulty about the share of £46 million being in addition to the January figure. But that is not the answer to my question. That only tells us what could be the position. We want to know the actual position. We do not ask this only out of idle curiosity. This question is fundamental to the whole sphere of housing policy in the public sector. It bears on whether that policy is operating effectively and whether the take-up is as planned by the Government.
The Minister touched on the question of the general expenditure limits for grant purposes, and he said that there was no evidence that the present limits in the 1969 Act held back expenditure on improvements. He quoted an average figure of £500 on the basis of experience gained, but I do not accept an average figure of that sort as an answer to the main point. The main point is that, if the Act envisages applicants being entitled to a certain level of assistance in real terms, then from time to time we should look at the effectiveness of the figures in the Act to see whether people are benefiting as Parliament intended.
The Minister referred to rising costs. I did not understand the figures which he gave, because they did not seem to tie up with the figures which we are receiving from the National Federation of Building Trades Employers and the Building Materials Producers' Council. They give different figures of rising costs month by month which do not tie up with the Minister's figures.
It is clear that there is a sharp rise in costs, which means that there is a drop in real terms in the value of the grant limits. The question is not whether a person who applies for only £500 or so can come well within the Act and not suffer from it, but whether a person who wished to apply for something at the lop level is, as it were, being squeezed because of the drop in real value of the grants in the Act.
We shall inevitably come back to that point later, but I hope that, in the light of the answers which we had to a whole series of points which were raised on Friday, the Minister will answer these

points, which are of central importance to our understanding of what is going on in housing in the public sector. If further time is required while inevitably information passes between the Box and the Front Bench, so be it ; but at some stage tonight—preferably now—these specific points of information on the projected financial take-up should be given to the House.

The Under-Secretary of State for the Environment (Mr. Paul Channon): I will attempt to answer some of the questions raised by the hon. Member for Willesden, East (Mr. Freeson). If I do not answer all of them, perhaps he will remind me of any particular point and I will endeavour to answer it. If I cannot supply the answer straight away, I shall have a further opportunity on the Question, That Clause 2 stand part of the Bill.
I will take the last point first which concerned the general limits. The short answer—we shall have a further opportunity to debate the matter when we come to the relevant Amendments—is that a general power to raise the limits exists in the Housing Act, 1969. If there were sufficient evidence, my right hon. Friend would have no hesitation in raising the top limit of grant ; but, as he endeavoured to show earlier, so far there is no evidence that a general increase is necessary and there is no evidence that improvements are being held up because the top level of grant is too low. Should such general evidence be produced, powers exist which enable my right hon. Friend to raise the limit, and in such circumstances he certainly would do so. However, there is no general evidence that that is necessary.
The hon. Member for Willesden, East may be able to produce isolated examples I know of very few. However, if he has any evidence that the general limits are too low, we should be delighted to consider it not only during the passage of the Bill, but at any later date.

Mr. Freeson: Perhaps I might raise two points. First, we are not concerned with the immediate past or the current position, but with projecting forward. We should learn from experience. There is clear evidence of sharply rising costs and that they are likely to continue.
Secondly, the hon. Gentleman repeated what his right hon. Friend said about the existence of a general power to increase the grant levels. This is not so, as we shall show when we come to new Clause 2. I must place on record that the Minister, no doubt unintentionally, misstated the position. There is no general power.

Mr. Channon: My right hon. Friend will seek to answer the hon. Gentleman when we come to new Clause 2 and show that there is such a general power. I suspect that I shall be out of order if I try to develop that now. I assert that there is such a general power, but perhaps the hon. Gentleman will be able to convince my right hon. Friend that it does not exist. We believe that it does, and my right hon. Friend will seek to show how it is applied.
Perhaps for the purposes of the Amendment the hon. Gentleman will accept for the time being that I am right in saying that such a power exists, and that my right hon. Friend would have no hesitation in raising the limit if there were any evidence that it was proving a handicap. The hon. Gentleman does not think that such a power exists. Perhaps I could leave the question whether it does until we come to new Clause 2, and invite the hon. Gentleman to look at Sections 5(3) and 37(5) of the 1969 Act.

On the question of the £46 million, my right hon. Friend has tried to show that this is the most accurate forecast that we can make, but it is a forecast rather than an estimate. The Explanatory and Financial Memorandum says :
On the best estimate that can be made, the Bill will result in increased public capital expenditure … of the order of £46 million …
My right hon. Friend was careful during the Second Reading debate to make it clear that this was the best estimate that could be made. It may turn out to be an under-estimate. I hope, as I am sure the House does, that it will. It may be an over-estimate, but I hope that that will not be the case.

The sum of £46 million represents capital grants by local authorities to owners and expenditure by local authorities on improving their own houses. It is impossible to be precise about what proportion of the £46 million will come out of the rates, and what proportion out of Exchequer expenditure, but it will

inevitably be a comparatively small proportion that is borne by anything other than Exchequer expenditure, because under the Bill 7½ per cent. of the grants to owner-occupiers will be borne by local authorities, and 25 per cent. of the work in their own houses, and the remainder will be borne by the Exchequer.

I shall attempt to show what proportion of the £46 million will be spent by local authorities on their own houses as opposed to the forecast of expenditure on owner-occupiers, or rented accommodation. We can try to break it down further, but whether it will have much meaning, or be more than an informed guess, I do not know. It is a small proportion that is borne out of the rate-borne expenditure rather than the Exchequer burden, because it is 7½ per cent. of that grant, and 25 per cent. of the work on their own houses.

The hon. Gentleman also raised, very correctly, as he did on Second Reading, the question of the whole expenditure on housing, and whether this was a substitute for, or an addition to, an existing figure. He asked how this extra £46 million was arrived at. I repeat the assurance that I gave on Second Reading, and I hope that I can satisfy the hon. Gentleman, that this is an extra amount. This figure of £46 million over this period is the extra amount that will be spent, if we can arrive at that figure. Nothing is taken out of the Housing Estimates to make up for this extra £46 million. There is no cut-back, if I dare to be controversial, in local authority mortgages. There is no cut-back of any other housing expenditure to make room for this figure of £46 million which it is our hope will be spent during this period.
This is extra expenditure.

12.15 a.m.

Mr. Freeson: I was choosing my words carefully. The point that the hon. Gentleman makes is that there has been no cut-back and that implies a Government decision. This was not what I was asking. I was asking whether, not because of a Government decision, but because of the operation of the policy generally in the country, there was an under-spending indicated on current estimates for 1971–72. I do not say that it is because of a decision to cut hack but is it the case that the original figure


of £1,144·4 million shows an indication of being taken up during the course of the year?

Mr. Channon: I would like to be able to give the hon. Member a conclusive answer, but I do not think that I can because it is too early to tell. The short answer is that, whether or not there is an under-spending and I have no evidence to assume that there will be—I hesitate to say either way at this point—it is irrelevant to the decision to introduce the Bill. It is not because we believe that there will be an under-spending on housing expenditure that we suddenly thought "Let us see what we can pop in."
That is not what happened. There may be an over or under-spending or we may have it right. At the moment we see no reason to assume that there will be an over-spending or anything else. I assure the hon. Member that this is a genuine extra sum, to be added to the estimates made by my right hon. Friend.
Since the hon. Member raised the point on Second Reading I have been advised that what I told him then is in accordance with the practice of both governments. They have not broken down expenditure in the way the hon. Member would like me to do. I am tempted to do so, but I am advised that this is the practice followed by all previous Governments. It would be extremely rash of me to try to break this practice.

[Mr. BREWIS in the Chair]

Mr. Freeson: I assure the hon. Gentleman that I would not consider it rash of him. I am not making a party point on this. If I may be a little rash, when I was in the position now held by the minister I held the view—maybe I had false hopes—that we should try to give a more accurate breakdown of figures of this kind within and outside the Department. May I urge the hon. Gentleman not to accept the present position just because it has always been the practice.
No doubt there will be other opportunities to return to this, but I believe that this question of providing more accurate figures, of monitoring perhaps, is of central importance to the future evolution of housing policy. Perhaps Governments have been wrong in the past in giving these generalised figures. There is even

less excuse today because there has been a build-up over recent years of statistical monitoring. With modern methods there is less reason for continuing the practice of putting out this type of figure. The figure which appeared in the White Paper—and I say the same thing of previous Governments—in terms of comparing the operation of one housing policy with another is meaningless.

The Temporary Chairman (Mr. John Brewis): We must come to a decision on this Amendment.

Mr. Channon: The hon. Gentleman will appreciate that I am not in a position to answer the latter point.
The Financial Memorandum to the Housing Act, 1969, made a forecast for increased expenditure of about £40 million. In the event, the figure for last year turned out to be between £75 million and £80 million. I will give an approximate breakdown, but I trust that the Committee will forgive me if my statistics are not accurate. About £11.9 million was paid out in 1970 in discretionary grants to private owners, £7 million by way of standard grants, and a further £50 million was spent by local authorities on their own properties. A sum was also provided for housing associations. This amounted to about £75 million in all.
It is difficult to differentiate in a debate such as this between some of the items ; for example, between grants paid to owners and sums spent by local authorities on their own properties. I only hope that I have not made matters more complicated by giving this rough breakdown. If I have confused the issue or if I am wrong, I will take the opportunity later of correcting the figures.
Having given this explanation, I hope that hon. Gentlemen opposite will not press the Amendment. We have a number of interesting aspects of the subject to debate on later Amendments, when we will do our best to give further information.

Mr. Ronald Brown: I am grateful to the Minister for the courteous way in which he has dealt with the points I raised last Friday. However, I have been searching in the Library to find a figure which corresponds to the one he has given for


increased house-building costs, and I cannot find such a figure.
He said that the cost yardstick was increasing annually by between 7 per cent. and 12 per cent. If that is the position, then the point I raised on Friday is relevant. Is there an element within the sum of £46 million which reflects this annual increase? If the yardstick is increasing by the amount he said, then there must be corresponding increases in the grant to cover it. I hope the Minister will bear in mind the need for the grant to reflect inflationary increases in the cost of repairs. Does the sum of £46 million reflect these increases?

Mr. Amery: I wish it were possible to forecast as accurately as the hon. Gentleman asks. I do not believe that the forecast of £46 million is accurate enough to take into account the kind of considerations he has raised.

Dr. Dickson Mabon: We are pleased with the amount of information we have been given, which it is not possible for us to digest without studying it in HANSARD.
It might be helpful if I were to indicate how we propose to discuss later issues. We do not intend to debate later Amendments dealing with the replacement of 75 per cent. by 90 per cent. We are taking this view to facilitate the progress of the Committee. We will listen to the case that is made in relation to Amendment No. 16 and we will probably wish to debate Amendment No. 17 and Clauses 2 and 3 stand part. This will enable my hon. Friends to raise a number of points without moving what I might call fractional Amendments which probe why one figure is designed to replace another.
Having said that, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. Channon: I beg to move, Amendment No. 16 in page 2, line 36, at end insert :

Section 6(2) (Limit on amount of improvement grant payable in advance)
One half
'75 per cent'.

Section 6(1) of the Housing Act, 1969, allows an improvement grant to be paid

in instalments as the works progress. The balance would then be paid on the completion of the works. Where a grant is paid by instalments, Section 6(2) of that Act provides that at no time may the aggregate of the instalments
… exeed one half of the aggregate cost of the works executed up to that time.

I apologise to the Committee that the Amendment should be necessary. This should have been in the original Bill. The effect of the Amendment is to increase this limit from 50 per cent. to 75 per cent. of the total cost of the improvement works so far carried out. This means that the advance payments that may be made will reflect the increase in the proportion of improvement grant, from 50 per cent. to 75 per cent. of the approved cost, proposed in the Bill.

The Amendment will bring the provisions in the Bill relating to England and Wales into line with those already contained in Clause 3(1) in relation to Scotland. The authority is not obliged to pay by instalments, and if it decides to pay by instalments it will not be obliged to pay as much as three quarters. Indeed, perhaps towards the end of the period, it will be cautious about going so high. All that the Amendment does is to give it the power to go up to three-quarters to pay by instalment, if it wishes.

As the maximum grant is now three quarters, and as a number, but not an enormous number, pay by instalments, it seems only reasonable, if they wish, that they should have the power to pay by instalments up to 75 per cent. This is a very small point and I hope that the Committee will feel able to agree with it.

Amendment agreed to.

Mr. Freeson: I beg to move, Amendment No. 17, in page 2, line 36, at end insert :
Section 5(2)(a) (Limit on improvement grant) £1,000 £1,250.
Section 5(2)(b) (Limit on improvement grant) £1,200 £1,500.
The general point of the Amendment is in pursuit of the observation made by a number of hon. Members in Committee and on Second Reading, and in pursuit of the point I made a few minutes ago, that account must be taken of rising costs in the projected operation of the Bill when it becomes an Act. It is not sufficient to


take the present situation and say that it is satisfactory and leave it at that.
There is no quarrel about the improvements in percentage contribution which the Bill has at its heart. This has been quite clear during the proceedings. The effect of the Amendment would be that the increased percentage contributions which the Bill already proposes will be on a larger ceiling, should this ceiling be reached. In other words, whereas now there is an increase of up 75 per cent. contribution on a total expenditure of £2,000, instead of the present £1,000, or 50 per cent. of that £2,000 as a ceiling, to take the more general case in the first line of the Amendment, if the figure goes to £1,250, it is on the basis that the top expenditure for grant calculation purposes becomes £2,500, and not £2,000, and the 75 per cent., as proposed in the Bill, will be 75 per cent. of that.
I have not worked out exact fractions here, but this is based broadly, first, upon the rising costs of building works and materials which we have already experienced since the 1969 Act became operative and which are currently rising at an even sharper rate, and it also allows for the fact that there will be a continuation of this rise, although at this stage we do not know for how long it will continue at the present very sharp rate of increase.
As I indicated earlier—although it did not seem to tally with what the Minister indicated on the rising costs of completed houses—the building trades employers and the B.M.P.C., in the information which they circulate publicly and to members specifically, and no doubt to the Department, have indicated that costs are rising at a rate of about 1 per cent. per month or about 15 per cent. over the year. I believe that it is about 15 per cent. in the London area and in the South-East, and the industry calculates that it is rising by 12 per cent. annually.
12.30 a.m.
If this considerable rate of interest continues over the coming year—there is little indication of a slow-down in the rate of increase—we shall shortly reach a position where the real value of the grant ceilings prescribed in the 1969 Act will be about £80. If the rise in costs of building and building materials continues beyond the next 12 months at

about the present level, there will be an even further depreciation in the value in real terms of the figures in the 1969 Act.
I appreciate the Minister's point that Section 5 of the 1969 Act empowers the Minister, on representations from local authorities, to agree to a higher ceiling in individual cases or in certain classes of case, but that is not the point. The Act deals with a general proposition for ceilings on grant aid, whether it be in terms of £1,000 or in terms of conversions. The fact that individual local authorities may give specific evidence in particular cases or groups of cases that there are difficulties which they have encountered or which housing associations have encountered or which private landlords have encountered does not meet the point
My point is that for the general run of people making use of this Act costs are rising so sharply currently and as projected into the next year or so that the real value is falling. That was not the intention of the Act. I accept that when the 1969 Bill was presented and the figures were looked into by the Department a factor was probably built into the figure, though it has never been clear to me what that figure was. I do not recall that on Second Reading or during the Committee proceedings on the 1969 Bill a specific figure was quoted as being the element that had been built into the figures to allow for a recognised rise in cost for a given number of years. It is certain that since the passage of that Act, in the past year or so and as currently projected the increase in costs in building has been so much sharper than it was at the time that the Bill was being prepared that we must now take account of it. The Act could not have foreseen a rise in costs of 12 per cent. to 15 per cent. annually.
These are the reasons why, if we are to operate the original Act and the amending Bill in the true spirit of the Act and of the Bill, we should seek to bring the figures in the Act and, by implication, those in the Bill into line with real values. Where £1,000 has become £800, we must ensure that the original value is re-established, and the only way to do that, as a general proposition, so that all people may have fair treatment, is to ensure that we increase the


figure in the Act by means of Amendment to the Bill to allow for it.
Hence the proposition that the £1,000 and the £1,250 should rise to £1,250 and £1,500. The due percentage contributions which the Bill proposes in general should thereby be increased in current cash terms to match the real objectives in cash terms intended under the 1969 Act, which it is the duty of all those who are interested in this aspect of housing policy to continue over an indefinite period ahead.

Mr. Channon: I congratulate the hon. Member for Willesden, East (Mr. Freeson) on raising this interesting point, which, I think, is well worthy of consideration by the Committee. I confess to having been slightly mystified initially as to the precise purpose of the Amendment, for reasons to which I shall come in a moment. I was interested in the figures which the hon. Gentleman had taken in the Amendment. He seeks to insert in Clause 2 further amendments to Section 5 of the Housing Act, 1969.
Originally. I thought that the hon. Gentleman had found an ingenious way of raising the point, which is perfectly accurate, that Section 5 of the 1969 Act limits local authorities, under subsection (1)(a), to one-half of the approved expense of the works or £1,000. Therefore, were we to increase the £1,000 to £1,500 for the ordinary improvement grant, the hon. Gentleman had it in mind, I thought, that we should amend Section 5(2) also in order to put that figure up to £1,500, since otherwise, although one would not have been caught by the one-half any more, one would be caught by the monetary limit, which would not be the 75 per cent. allowed under the Bill.
I hope that I can now meet the actual point which the hon. Gentleman has raised. Section 5(3) provides that the Minister may fix a higher amount with respect to a particular case—I agree that that would not be suitable in relation to this Bill and the generality of cases—and also, which is the important point, he is entitled to fix a higher amount with respect to a class of case.
My right hon. Friend has it in mind, if the Bill becomes law, as, I think, the whole House hopes it will, to approve higher limits for a particular class of case to which the Bill applies, that is,

for improvement grants in the development and intermediate areas. He will make these limits £1,500 and £1,800 in order to meet the point I have made about the 75 per cent. as opposed to the 50 per cent. in the past. Obviously, the £1,500 is 75 per cent. of the ordinary improvement grant and £1,800 is 75 per cent. of the special grant, as the hon. Gentleman will have seen. The 1969 Act gives power to do that by administrative action. Such an approval will be included in the circular to be sent to local authorities after the Bill has been passed. I am glad to have had a chance to make that clear, because some local authorities or others interested in the Bill may wonder whether Section 5(2) imposes a limit that we had not intended.
The hon. Gentleman based his argument largely on the question of rising costs. I see his point, that if costs rise the whole time the real value of the improvement grants will be eroded. Such rising costs, if they continue, are likely to be countrywide and not limited to development or intermediate areas. If it proves necessary to increase the general limits for improvement grants because costs go on rising, that can and will be done by Order. The Committee will agree that such an Order should apply to the country as a whole, and therefore would not be particularly relevant to the Bill. If there were to be a general Order for the whole country, the extra amounts given to development and intermediate areas could be included under the Clause, where specific power is taken to show that where more money is given to the country as a whole the differential to development and intermediate areas can be preserved. So the power to do what the hon. Gentleman would like us to do already exists. My right hon. Friend will have a chance to show him in great detail exactly how it exists under various Sections of the 1969 Act when we come to new Clause 2. As that power exists, the Amendment is unnecessary for that purpose.
The limit imposed by Section 5(2) of the 1969 Act can be raised, as is clearly set out in Section 5(3). My right hon. Friend has it in mind to go further to meet the requirements of the Bill, from £1,000 to £1,500 for improvement grants and for special grants from £1,200 to £1,800.
I hope that that explanation will satisfy the hon. Gentleman. He has raised a very real point about the need to keep improvement grants up with rising costs, should they go on rising. There is no evidence that there is any need to increase them now ; there is no evidence that they are biting at the top level. Should they do so, my right hon. Friend has the power that the hon. Gentleman seeks in the Amendment. We shall bear in mind what the hon. Gentleman said, and I hope that he will feel it unnecessary to press the Amendment.

Mr. Freeson: I do not intend to press the Amendment, but the matter should be kept very much alive in the Department and before the House. It is very difficult to establish clearly when there is firm evidence that because of rising costs or a reduction in the value of the pound a direct impact is being felt on improvements policy. There are so many factors. Between 1949 and 1969, with the introduction of standard improvement grants in the middle 1950s, which was only a marginal contribution to the solution of a big problem, there was no change in the figures for improvement under the 1949 Act.
12.45 a.m.
One of the reasons for the loss of impact of the improvements policy was that Parliament had been content to allow the figure to remain, although it had long since lost its value, had been halved or even worse. It is important not to allow long gaps to occur, not gaps of 20 years, but not even of two, or three, or five years. This is something which must be constantly watched to ensure that the Act builds up a modest impetus. The only way to do that is to accept the purpose of the legislation and to ensure that the purpose is maintained.
I do not fully accept what the hon. Gentleman says, but I shall not press the Amendment. When I say that I do not fully accept what he says, I mean that it is not sufficient to wait to see what effect a reduction in the value of the pound will have on improvements policy. It must be having an effect now. If £1,000 of two years ago is now worth only £800, there is an effect on every owner-occupier and local authority wishing to undertake this work. We need

not go through a sophisticated exercise to reach that conclusion.

Mr. Channon: I may have misled the hon. Gentleman at one point. I think that I referred to a special improvement grant. The sum of £1,200 is, of course, for the conversion of houses ; that is not a special improvement grant.

Mr. Freeson: I had noted that and assumed it to be a slip of the tongue.
We need not undertake a sophisticated exercise to see the impact of rising costs. Action needs to be prompt when the value of money is falling as it is. If our suggestion is not accepted tonight, I hope that the matter will come before the Ministry and before Parliament again within the coming year. I do not expect an undertaking now, but we shall un-doutedly be returning to this subject.

[Mr. ARTHUR PROBERT in the Chair]

Mr. Ronald Brown: I listened intently to the Under-Secretary and I am still not satisfied that the point we have been making has been taken. Under the provisions of the Housing Act, 1969, many items may be included in the cost of the work, including survey and legal fees. That element of the cost alone has risen and the White Paper published today recognises the rise to such an extent that a special subsidy is suggested to meet it.
The Under-Secretary is under-estimating the increase in costs. Local authority personnel tell me that by the time they have fixed the cost of a contract and got agreement about the amount of work to be done within the two-year period, especially when additional work such as dealing with dry rot is found to be necessary, costs have risen above the original figure. I am still not satisfied, incidentally, that the Minister has agreed that when additional work is found to be necessary, for instance, during a conversion, the extra work will rank for grant to meet rising costs.

Mr. Channon: I will take careful note of all the points made by the hon. Member for Shoreditch and Finsbury (Mr. Ronald Brown). My right hon. Friend has often made it clear that we shall keep the closest watch on the limits of the system, and if there is evidence that they are proving too low, he will not hesitate to raise them.

Mr. Freeson: That is not the point.

Mr. Channon: I thought that it was ; I am sorry if I have misunderstood.

Mr. Freeson: Semantics are important in this. The Under-Secretary keeps saying that if there is evidence to show that the rising cost is having an impact on the level of house improvements, the Minister will take action immediately. That does not mean very much. There is no need for further evidence than that the £ is worth only 90p after one year and that it will fall to 80p in real terms at the end of another year. Translate that into the Bill and we know that people will get less done for their money and less done within the grant ceilings.
We do not need to wait for the evidence that, instead of 156,000 improvement grants rising to a projected 170,000, they have risen to only 165,000 or 167,000, to take action on rising costs. There is a real and sharp difference in costs, not just a marginal one. All the evidence is that this will continue for some time and that in itself is evidence enough for the Government to act, if not tonight then within a very short time.

Mr. Channon: I see the point. It was hoped that the £1,000 figure fixed in 1969 would last for some time and that it was a generous sum. It probably was generous. But there is no evidence that the difference in the value of money is having any deleterious effect on the improvement grant scheme.
We will keep the figures up to date and if necessary we will increase the improvement grants. My right hon. Friend has shown that he is extremely anxious to keep up the impetus of improvement grants. The figures have been extremely good and we hope this will continue because the grants meet a social and economic need.
I hope hon. Members will not have to chide us for not having lived up to our responsibilities. We shall keep the limits and the working of the scheme carefully, urgently and constantly under consideration. I cannot go any further than that but I welcome the debate because it shows how important this matter is and the keen interest that all hon. Members have shown in keeping up the momentum of the scheme. We shall do all we can to maintain that momentum.

Mr. Freeson: Whatever the differences of emphasis, sharp or otherwise, that there

may have been on this point, I accept that the Minister has gone as far as he can in the assurances he has given about the general intentions. As I have given for our part an undertaking that we propose to return to this as the opportunity arises, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

The Temporary Chairman (Mr. Probert): I understand that the hon. Member for Willesden, East (Mr. Free-son is not proceeding with Amendment No. 18, in page 2, line 37, leave out '75' and insert '90', and Amendment No. 19, in line 40, leave out '75' and insert '90'.—both standing in his name and the name of the hon. Member for Greenock (Dr. Dickson Mabon).

Mr. Freeson: That is so, Mr. Probert, for reasons which my hon. Friend mentioned earlier.

Mr. Frank Allaun: I beg to move Amendment No. 21, in page 3, line 41, at end insert :
(3A) Where assistance has been given to a private landlord by the making of a grant specified in this section, the rent officer in determining what rent is or would be a fair rent shall have regard to the fact that the increase in the value of the property has resulted primarily from the use of public funds and not from the funds of the landlord.
Hon. Members from constituencies all over the country are being approached by tenants in great trouble—tenants whose rents are being trebled or more because they possess a bathroom or because one is being installed. This results from the 1969 Act. I remind the Committee that several of us voted against the appropriate Clause in the Standing Committee which considered that Measure because we foresaw precisely what would happen.
These tenants dearly want a bathroom, lavatory and hot water but they cannot afford such a drastic increase in their rent to pay for them. Therefore, they are now attempting to resist these improvements, but they cannot resist them because, under the Act, they can be compelled to have them done and their rents increased. There are exceptions for people on such low incomes that they are to get these improvements on supplementary benefit and those under £10 a week income or £12·25p if married.
I am afraid that this situation will lead—and I am as concerned as anyone about improvements—to a widespread tenants' resistence movement, which is the last thing we want to see. Under this Bill, landlords are being give a fourfold bonanza. First, they already get a grant of 50 per cent. of the cost of improving their houses under the 1969 Act ; secondly, they get a greatly increased value on their property in consequence ; thirdly and most profitable of all, they are allowed to take their houses out of the present rent control, which roughly increases rents 2.6 times—these are Ministry figures—even before the added improvement is allowed for in the form of the further increases ; fourthly, now the grant is to be raised to 75 per cent.
The landlords are going to enjoy this bonanza. What about the tenants? Have they no rights, except the right to have their rents sharply increased? Surely it is reasonable that, if the landlord is to be so greatly helped out of public funds, the tenant should not be forced to pay for it, or not to this extent. It may be argued that this is not the case, since it is the taxpayers who stand 75 per cent. of the cost. If the tenant's rent remained the same, that would be so, but it will not. It will be increased, not 2.6 times, but between 3.6 and 4 times in many cases. Therefore, my hon. Friends and I urge that the very least protection should be that the rent officer and the rent assessment committee be required to consider the hand-out from public funds to the landlord when fixing the new rent.
1.0 a.m.
If bribing the landlords brought results, it might be acceptable ; but when accompanied by a penalty for the tenant it is insupportable. I am reported last Friday as having said that I opposed "driving" landlords to improve houses. I assure hon. Members that that is not my position. What I said was that I was opposed to "bribing" landlords to improve houses, which is very different. However, it is too late to make a correction.
I can take hon. Members to a row of houses in Salford—"Coronation Street" land—which, before the 1969 Act, had been greatly improved. They have had

a bedroom or half a bedroom converted into a bathroom. It cost the tenants 8s. a week extra. They are delighted. It has turned their houses into what they call little palaces. I do not suggest that the landlord made a fortune out of this ; but he is not a philanthropist. He covered his cost with the aid of the grant, which at that time was 12½ per cent. of his share of the cost, and he did it for 8s. a week. He did not lose on it, or he would not have done it. Now I must go to the tenants and say, "Sorry, gentlemen, your rent is not going up by 8s. a week ; it will be trebled or quadrupled". What will they think of their Member of Parliament or other Members of Parliament who will have put him in that position? Now the grant is to be increased from 50 to 75 per cent. It is therefore even more imperative that tenants be protected. Without this Amendmentment, unfortunately, the improvements campaign will encounter very serious obstacles.
If the so-called fair rents system were working equitably, I might feel less strongly than I do on this issue. But it is not. The average controlled rent is multiplied 2·6 times when it comes out of control, and this has a great bearing on another Bill referred to earlier today. When it comes out of control and into regulation through the rent fixing machinery, this is the average increase : a rent of £2 a week plus rates becomes £5 4s. plus rates. But in certain areas, such as London, the percentage increase is far higher. In addition, where a bathroom is installed, the rent officer naturally says that the value of the house has increased and adds yet again to the rent.
I assure hon. Members that discontent is boiling over in London about rents. Last week, in a crowded room in the House, spokesmen for tenants' associations from all over London representing the thousands of people concerned met to consider what is happening. They reported how big property companies are increasing rents drastically every three years ; that the scarcity factor which accounts for high rents and which the Act says is to be ignored is clearly not being ignored ; how some rent officers are fixing widely different rents for identical flats in the same block ; how highly paid lawyers whom the tenants cannot afford are being employed for the big property companies ; of illegal


premiums of £1,000 being required of incoming tenants ; of tenants being forced out to provide flats for wealthy tourists ; of many rent assessment committee members being heavily biased in favour of high property values—I am thinking of chartered surveyors, lawyers, and so on ; and regulated tenants paying more than unregulated tenants.
The tenants are meeting again this week or next week, and a dossier will be presented to the Minister of the things that are taking place under the Rent Act which are completely contrary to what most of us believed were the objectives of that Act.

Mr. Frank McElhone: I should be failing in my duty if I did not support my hon. Friend (he Member for Salford, East (Mr. Frank Allaun). On 14th January, 1968, there was a terrible storm in Glasgow. As a result of my right hon. Friend the then Secretary of State in the Labour Government taking the initiative, Glasgow received £6 million for the renovation of thousands of tenements which had been neglected for generations by the property owners. That situation is now being exploited.
Now that rents have been decontrolled, I know from the experience of my Saturday surgery, that factors and property owners are increasing rents at a tremendous rate. The weakness of the Rent Act is that no general principles are laid down for the guidance of rent officers. Differing rent assessments are made of similar houses in the same street, and I am at a loss to understand how the assessments are made. Perhaps they are made on a rule-of-thumb basis.
Now that these houses have been decontrolled, real hardship is being suffered. There must be a rethinking of the whole system of fair rents, fair rent officers and the method of arbitration. It would be entirely wrong for us to give out public money as a bonanza to property owners who have for generations neglected their property.
The cry of property owners is that the high cost of repairs has prevented them from maintaining their property. In my constituency, because of a grievous housing shortage, individual flats in tenement buildings have been sold. It is no exaggeration to say that there are few

tenement buildings in which two or three or perhaps more flats have not been sold at grossly inflated prices. Many houses do not have an inside toilet or even a bath. The profits from the sale of these tenement flats are often three times as much as the landlord paid for the whole property.

Mr. Robert Hughes: I wish to emphasise what was said by my hon. Friend the Member for Glasgow, Gorbals (Mr. McElhone) about the general state of tenanted properties in Scotland. In the past landlords have been extremely reluctant to carry out repairs, modernisation and improvement of the properties they own. The excuse that is often trotted out for not ploughing back profits into these properties is the low level of rents prevailing generally in Scotland. This is only an excuse, because the general tendency of landlords has been to make a "fast buck" when the going is good and to let the property run down. If this were not the case, we would not have needed a number of Housing Acts over many years to try to get landlords to carry out some repairs.
We have seen a number of Acts since the war. The 1957 Housing Act led to considerable decontrol of housing tenancies, and allowed landlords to increase rents if they spent a certain amount of money on the property. My evidence is that that Act did not lead to any great improvement in housing. All that happened was that wherever possible tenants were forced out to make room for uncontrolled tenancies. Many people have come to see me over the years and have told me that they have been offered a three-bedroom flat on a different floor in place of a two-bedroom flat in which they have been living only to find that the flat into which they have moved is decontrolled and that they have no protection under the Housing Acts.
There is no evidence that the 1957 Housing Act led to any increase in the number of improvements carried out by landlords. In this Bill we see another attempt to encourage landlords to undertake improvements, and any improvements will be welcomed, but the result is bound to be that rents are likely to rise.
The problem is that we are not dealing with this Bill in isolation. It is to be seen against the background of the White


Paper which was presented today and which seeks to extend rent rebates to private tenants. The result will be an upward spiral in the general level of rents. We have this whole bonanza of landlords being able to get more for properties which they have neglected in the past.
As my hon. Friend the Member for Salford, East (Mr. Frank Allaun) pointed out, the landlord can force improvements to be carried out despite the resistance of the tenant. It is understandable that tenants are worried about improvements to conditions which have been tolerated by landlords for 30 or more years because the tenants fear that they will be unable to meet the increased rents which will result from those improvements.
I do not know about the situation in England and Wales, but in Scotland there is a possibility that the tenant will be able to withhold his consent for improvements to be carried out. However, there is a catch in it. If the landlord wishes to proceed with improvements against the tenants's wishes the landlord can go to the sheriff court and apply for the improvements to be done and that court, in certain circumstances, will allow the matter to go forward. It would be wrong to cast any aspersions on the legal profession, and particularly those who are engaged in the courts. But it is fair to say that their outlook on these matters is not the same as mine. I have never known the law in Scotland, England or Wales to be particularly biased towards the ordinary working-class person.
1.15 a.m.
Many tenants have already been approached by their landlords, as a result of the 1969 Act and possibly given an impetus by this Bill, to see whether they are prepared to allow improvements to be done. If landlords are allowed to carry out improvements, they should not be entitled to a return on Government money.
We used to hear about the poor landlord who has inherited property which he did not want and the landlord who, immediately after the war, had to buy a tenement flat to get a home for himself and found that he got a bad bargain in taking over property which needed a

great deal of maintenance. Now there is strong evidence that the property companies are finding it profitable to buy older houses with poor amenities, which have been neglected for generations, and to make block applications for improvement grants. I understand that the local authorities have no discretion in these matters in relation to standard. Provided that these applications meet the qualifications in terms of plans, they must go ahead and allow the grants.
Whether a local authority would be within its rights in refusing discretionary grants on the ground that these were block applications specifically for profit making, I do not know. It may be that some local authority will have to challenge the matter by saying, "We do not believe that this is the way that the money should be spent. If property companies wish to make a killing in housing by carrying out repairs, they should put up their own money."
If the matter went to the courts, I should hesitate to speculate on the outcome. I suggest that the courts might decide that this was a valid application under the various Acts. Certainly I cannot see anything in the Act which defines a landlord as being either an individual or a property company.
We have heard ad nauseam about Government money being used to subsidise tenants in municipal properties who could afford to pay higher rents. This hoary old tale is hawked about the country and repeated month after month. This kind of subsidy to people to enable them to develop properties and increase rents on properties which they would not have allowed to get into such bad conditions is scandalous. I hope that the Government will accept the Amendment because it seeks to provide a very much needed and overdue protection for tenants.

Mr. Ronald Brown: This area of the Bill is very weak. With respect to my hon. Friend the Member for Salford, East (Mr. Frank Allaun) the Amendment does not cover this problem. I should have appreciated an opportunity of discussing this matter with my hon. Friend, because I should have liked to have had incorporated the question of maintenance after the improvements have been carried out. When a landlord has carried out improvements he gets his regulated rent. It is assumed from that time on that the


quality of the house or flat will remain the same, because the tenant will have to pay a higher rent. However, experience has shown that landlords do not maintain properties to the standards achieved when the improvements were carried out.
It might be said that the answer is quite simple : call in the public health inspector and get a sanitary notice put on the property, and so on. Somebody from the inspectorate comes along and tries to hurry the owner into getting the work done. The owner finally gets an estimate, and that represents starting the work. Six weeks, or six months, go by before the owner can be pushed into the next stage, which is getting a builder's estimate. Following that, another six months go by, and all the time the tenant is paying the increased rent which was agreed upon when the improvement grant was applied for.
What my hon. Friend proposes does not reflect that situation, and I hope that somewhere in the Bill there will be a provision to protect the tenant. After all, a fair rent is described in the White Paper as
the likely market rent that a dwelling could command if supply and demand for rented accommodation were broadly in balance in the area concerned".
We all know that it is an impossible assessment to make. Nevertheless, unless some restriction is imposed landlords will get their money and their tenants will be left to pursue them to try to get the necessary improvements carried out.
I appreciate the point made by my hon. Friend about tenement buildings. The White Paper talks of a declining private rented market and the dissuasive effects of rent regulations on landlords. The extraordinary thing is that landlords are rushing in to buy tenement buildings in my constituency. One such building was purchased on the morning that the Minister was expected to announce his decision that it should be demolished. He made his announcement at 11.30 a.m., and it was found that the property had changed hands at 11 a.m.
The result of that exercise is a High Court case, but the tenants are still living in distressing conditions. The new owners cannot afford to spend a penny on the property, and they are apparently waiting to take advantage of the pro-

visions in the Bill to make improvements to it. When that is done they will be able to get the rent they require, and they will make money hand over fist.
I hope that if we provide landlords with money to improve their property we shall give local authorities and rent officers the opportunity to assess from time to time whether the standards of maintenance of properties in their areas are up to standards for which the grants were made.

Mr. Channon: This is an important Amendment, and I shall try to deal with the points that have been raised. If I fail to deal adequately with the Scottish points, I am sure that hon. Gentlemen will forgive me if they are answered by my hon Friend the Member for Ayr (Mr. Younger).
I am tempted to talk about sheriff courts, but the right hon. Member for Kilmarnock (Mr. Ross) would be—

Mr. William Ross: Perhaps the hon. Gentleman would talk about the Procurator Fiscal

Mr. Channon: The night is young, and I might do that. What I have to say applies to Scotland, but if I do not deal adequately with the Scottish points that have been raised perhaps my hon. Friend will be permitted to deal with them.
The hon. Member for Shoreditch and Finsbury (Mr. Ronald Brown) has, on many occasions, raised the case to which he has just referred. The hon. Gentleman is to be commended for his diligence to his constituents, but he will not expect me to deal with the merits of the case in question because, as he said, a court action is pending.
The hon. Member talked about maintenance of houses in disrepair. In fairness, he should look at Section 72 of the Housing Act 1969, which gives local authorities the power to require the repair of houses. This should help. A tenant can go to the rent officer if his circumstances alter, if the house falls into disrepair and so on. That is not a complete answer but the Act gives local authorities the power to insist that repairs are done and if certain statutory processes are gone through the tenant can carry out the repairs and make the landlord pay for them. That is certainly a step forward.
It is probably true that what the hon. Gentleman said about the working of the fair rent system and the rent officers represents a minority view. [Interruption.] That may not be so in Scotland but I think it is the case in England and Wales. I do not say that the hon. Gentleman is wrong, minorities are often right. Most people think that the fair rent system has worked reasonably well. The Francis Committee recently reported and it unanimously concluded that the system was working well. There was a minority report on certain aspects of the subject. But that was the unanimous conclusion of the Committee, and there was a Scottish member.

Mr. Tom McMillan: He was outvoted.

Mr. Channon: No, he was part of the majority. The Scottish and Welsh members and the English members, with one exception, were unanimous on all points. I am glad that the Scot was able to influence the Committee. Mr. McNiven was his name and he was appointed by the right hon. Member for Kilmarnock (Mr. Ross). I congratulate him on a very wise appointment.
The hon. Member for Salford, East is well known for the strength of his views on this issue and for the battle he has waged on behalf of controlled tenants over many years. His view is not generally held in the Committee. He pointed out that he was against a Section in the 1969 Housing Act introduced by his right hon. Friends. For all I know he may have voted against the 1968 Act—he spent most of his time last Parliament voting against his right hon. Friends and I respect him for that.

Mr. Allaun: In Standing Committee three Members on the Labour side who had pressed the improvements scheme very strongly voted against taking houses out of the existing control when they were improved.

Mr. Channon: I recall reading that debate and I recall an earlier occasion in 1967 when the hon. Member also voted against his right hon. Friends. He is consistent in his point of view.

Mr. Ross: Does that mean that my hon. Friend must not vote for it tonight?

Mr. Channon: We shall have to see.
1.30 a.m.
The fair rent system was largely the creation of the right hon. Member for Coventry, East (Mr. Crossman), built on by the now Lord Greenwood, and it had the support of nearly all hon. Members of the Labour Party, and at the time it perhaps did not have the enthusiastic support of some of my hon. Friends. However, it would be neither appropriate nor in order for me to discuss the whole principle of the fair rent.
I appreciate that the hon. Gentleman has considerable doubts about the whole principle of fair rents. I understand his argument—that as landlords will receive a larger improvement grant, extra attention should be paid to that when the fair rent assessment is made—but I believe it to be a misguided one. The Bill is concerned only with a small limited item, and that is to increase the rate of grant in the intermediate areas. It does not raise wider issues, though I am sure that hon. Members would like to debate the whole issue at some time. I suspect that there will be occasions in the coming months when we shall debate rental policy, and then it will be in order to consider the fair rent system and whether it should be changed.

Mr. Frank Allaun: The hon. Gentleman is making his case in a courteous way. He is suggesting that the Bill is confined to grants and is not concerned with rents. How can one discuss grants and ignore rents? It is like increasing the speed limit to 75 m.p.h. without taking steps to protect pedestrians. In either case the two cannot be separated.

Mr. Channon: I accept that the two are linked, but I will try to show that this is not the time to make the sort of Amendments the hon. Gentleman wishes to make.
As the law stands, a fair rent has no regard to the personal circumstances of the landlord or tenant. The hon. Gentleman is seeking to take into account for the first time the fact that the person has had public money and he wants that to be a criterion in assessing a fair rent. At present a fair rent is assessed, it is claimed, on objective criteria. A fair rent is defined broadly as the market rent discounting the scarcity factor. To import some other consideration would be to change the whole system.

Mr. Robert Hughes: Perhaps the hon. Gentleman will refresh my memory. Does not the 1969 Act call on the rent officer to take into account any money spent by the tenant in improving the property? If so, cannot the same consideration apply in the case the hon. Gentleman is now answering?

Mr. Channon: I will be dealing with this point later. If I forget to do so, I trust that the hon. Gentleman will draw it to my notice.
Section 46(1) of the 1968 Act defines a fair rent and how it should be determined. It says :
In determining for the purposes of this Part of this Act what rent is or would be a fair rent under a regulated tenancy of a dwelling-house, regard shall be had, subject to the following provisions of this section, to all the circumstances (other than personal circumstances) and in particular to the age, character and locality of the dwelling-house and to its state of repair.
On the technicalities of the Amendment, it is my belief that with the wording of the Rent Act, 1968, and the Section which I have just read, even were we to accept the Amendment, given that particular wording it would not make any difference, because even if the rent officer were to consider that public funds had been used, it would not affect any of the criteria laid down in Section 46 of the Rent Act, 1968, by which fair rents are determined.
But that is a drafting argument rather than an argument of substance to meet the hon. Member's point. The argument of substance is that the hon. Member is seeking that a rent officer should take account of the fact that an increase in value results mainly from the 75 per cent. grant. The implication behind the Amendment is, naturally, that a lower fair rent would be set for such a dwelling. Acceptance of the Amendment would introduce a fundamental change in the detailed rules which govern private rents where there have been grant-aided improvements.
The House may decide at some future date—I doubt it, but it is possible if one could imagine such a circumstance—that such a consideration ought to be part of the assessment of fair rents. But, if we believe that that is the case, it makes no difference in logic whether one does that with 50 per cent. or with 75

per cent. If it is urged that such things should be disregarded by the rent officer and that new criteria should be imported, the argument is equally strong whether one does it for 50 per cent. or for 75 per cent.
This modest Bill merely raises the grants in certain parts of the country. What the hon. Member should do, if he is moved to try to change a criterion for fair rent is to seek an opportunity to deal with the main question as to how a fair rent is assessed and what are the criteria. I suspect that we shall have plenty of opportunities of discussing that in the not very distant future.
I should point out some of the difficulties that would arise were the Committee to accept the Amendment. First, one would have to have different rules for assessing fair rents outside development and intermediate areas than one has inside them, and an entirely different criteria for assessing the fair rent. Within a development or an intermediate area one would also have to have two different criteria for assessing fair rents according to whether a property had received a 75 per cent. improvement grant under this Bill, or a 50 per cent. improvement grant under some previous Bill, or, indeed, after the expiry of this Bill. The Committee will agree that that would give rise to confusion and anomalies.
There are great practical difficulties. I am not sure how rent officers would necessarily know whether a house had received a grant. If it were the will of the Committee that this should be done, I am sure that these difficulties could be overcome. However, there would be considerable difficulties. At present there is no duty on a person to tell a rent officer that he has had an improvement grant of this kind, and the rent officer would be required to find out what the fair rent is and then to reduce it by a certain proportion to take into account all the factors that the hon. Member has in mind.
I suggest that this is not an Amendment which is appropriate to this Bill. The Amendment strikes at the whole basis of assessing fair rents in general, and the House will have to decide, in the coming months, whether fair rents are assessed equitably not only in the private


sector but, in view of the changes proposed by the Government, in the publict sector also. If the House decides that fair rents is an equitable way of deciding rents and the criteria that ought to be considered, that is the moment when this related question ought to be considered.
In a limited Bill dealing with a limited problem what the hon. Gentleman suggests would, I suspect, cause more confusion and problems or anomalies than it would solve. I therefore hope that the hon. Gentleman will not find it necessary to press the Amendment.

Mr. Freeson: Whether my hon. Friend the Member for Salford, East (Mr. Frank Allaun) wishes to press the Amendment or not and whether the Under-Secretary wishes to accept it or not, others of us will accept that my hon. Friend has raised a very important point. At the very outset of his remarks the Under-Secretary was a little provocative. No doubt he is sorry for that now, because otherwise perhaps I might not have risen to my feet.
There is an important point here. Much of the discussion has hinged on the relationship of the Amendment and what it seeks to do to the position, not only in the 1969 Act, but also in the Rent Acts of 1965 and 1968 where the proposal for fair rents was first set down. When the 1965 Rent Bill was before the House, in the early stages there was a great deal of discussion, both in the House and publicly in many quarters, about the difficult problem of definition, of which the Under-Secretary has made heavy weather, but I do not say that necessarily critically. There was a good deal of discussion about the merits or demerits of leaving the definition of "fair rent" in the form in which it remained in the Bill as enacted. A number of hon. Members, of whom I was one, had serious doubts about that.
When the Francis Committee was set up to examine and review the operations of the Act it was hoped by a number of hon. Members, including myself when I was in the position which the Under-Secretary now holds, that this aspect, too, would be taken account of. Views were not expressed, because it would have been wrong for any member of the Government to have done so while a committee to which he was a party was investigating

the matter independently. Some of us expected or hoped that this aspect would be dealt with. A number of views to this effect were expressed in serious articles in the Press, not only by people in the Labour Party, not only by people working in the social services and in welfare, but also by people in development. Some of the bigger private developers were concerned about getting a more sensible and rational approach.
One of the points which was revived in public discussion before Francis reported was precisely the point about re-considering the criteria of fair rent to take a closer account of actual cost involved on the part of the owner of a property in purchasing, in maintaining, in modernising—whether under improvement grant procedure or otherwise. Although I have not reached any firm or detailed view on this I am generally of the view, or I have come back to the view which I expressed on the original Rent Bill, that there is much to be said for being more specific about the criteria to be set by way of wording in the legislation or in guidance to rent officers.
We have not heard the last word on this. "Fair rents", which begs to question as a phrase, must always be defined. I doubt whether we should continue to define them solely as market rents less scarcity value, although that may have served a very useful purpose in the initial stages of the operation of the 1965 and 1968 Acts. I am inclined to the view that we should seek to relate the establishment of rents to basic costs and a fair return. In other words, we should return to the principle first enunciated in the 1949 Act in relation to improvements and which my hon. Friend has resurrected tonight—that is, a percentage return on outlay by an owner.
1.45 a.m.
In the White Paper, "Fair Deal for Housing", published today, this issue is raised once more along lines which will create even further difficulties. In paragraph 13, in the section on house improvement, it is said :
The landlord will still be allowed to charge, as soon as the improvement works have been carried out, a rent increase whose annual rate is 12½ per cent. of the amount (net of grant) spent on the improvements. But charging this increase will no longer interfere with the landlord's right to apply for a fair rent
that is, market rent less scarcity value. If it be wrong to pursue the principle


of a given return—10 per cent., 12½ per cent., or, as it was in 1949, I think, 8 per cent.—one wonders whether it is right and proper to continue the policy enunciated once more, in a very conditional way, in paragraph 13 of the White Paper. Why is it considered wrong to establish rents basically on the principle of a fair return on the capital and running costs of private property?
This is a limited debate, and the point will not be pressed, but I give general support to the case which my hon. Friend has advanced. The time has come, since the whole issue of rent policy in the public sector and, to some extent, the private sector is under debate again, to reconsider this question. We shall have to look far more closely at it.
I hope that the Minister, in the liberal and considerate spirit in which he answered my hon. Friend, will not close his mind to a careful re-examination of the criteria upon which fair rents, where labelled as such, are determined. The question must be reoponed. Let him and his colleagues consider whether a fairer basis can be established than just market rent less scarcity value. I think that the House will wish to do that, as we proceed in the months ahead, to use the hon. Gentleman's phrase.
If we can move in that direction and make the Rent Acts more effective and more fair, we shall at the same time help to restrain inflation. There is no doubt that, where there is a big jump between actual costs and a given percentage return, such as my hon. Friend proposed in a limited sense in his Amendment, and market rents way above the actual costs in which the owner is involved in running property, and we continue to legislate in those terms, we encourage inflation, and we encourage the continuance of unfair burdens on the ordinary householders who live in rented property.

Amendment negatived.

Clause 2, as amended, ordered to stand part of the Bill.

Clause 3

INCREASE IN FINANCIAL ASSISTANCE IN SCOTLAND

Question proposed, That the Clause stand part of the Bill.

Dr. J. Dickson Mabon: I do not press for specific answers to my points tonight, but merely seek from the Under-Secretary of State for Development Scottish Office, the assurance that he will consider them when we debate other matters later on today, when the White Paper for Scotland is published following that for England and Wales yesterday. I welcome the hon. Gentleman to our discussions. The Under-Secretary of State for Health and Education was here for the Second Reading, and his hon. Friend the Under-Secretary of State for Home Affairs and Agriculture has been here. It is nice to have a variety of Under-Secretaries from time to time.
No doubt the Clause and its implications for Scotland will be reflected in the Bill that is to come before us. I have reserved my hon. Friends' position, just as my hon. Friend the Member for Willesden, East (Mr. Freeson) did on behalf of his English colleagues, on the practice in the present rent system in Scotland. We do not go along completely with what the Francis Committee says. There is evidence since the publication of its Report to show that a number of assumptions are wrong.
The principle that if a tenant has done work on the house he may be given an amelioration in his rent by the landlord is already written into the present system. It is fair to argue that that landlord should not exact a higher rent when he has had public money. There may be other principles that we must debate, and the Under-Secretary may well promulgate a few more in the White Paper.
I have an earnest correspondent in my constituency who was fascinated by our exchanges on Friday and wrote at once to give me other suggestions. I shall put them to the Minister, and my hon. Friends from the Glasgow constituencies will probably want to put a few more ideal into his head.
Tenement properties are the most difficult to improve. The trouble is multiple ownership, which was one of the great


headaches at the time of the storm damage. It was not easy to find where the authorising responsibility lay, never mind the person who benefited. The answer to question 4 on page 3 of the hand-out encouraging people to apply for improvement grants shows that they must give a guarantee that the home has a life of at least 15 years. That cannot be done where a person does not own the common stairs and the fabric of the property above and below and does not have complete control over the plumbing—not just the existing plumbing but the extra plumbing that may be required under the new water board regulations and so on. There may not even be majority control by a combination of owner-occupiers. We must see whether there is another way of helping people who want to carry out improvements but who are in a sense vetoed because a landlord may be reluctant, or have elderly tenants who are reluctant to opt into the improvement scheme.
In the Labour Party we do things extremely well. If I were told that the improvement grant system was 90 per cent. correct, I should be delighted. I pressed the hon. Member to say whether it was 99 per cent. correct, but I never expected him to say that it was 100 per cent. correct. It is not ; there are defects in the improvements system and this is one. There are others which I shall mention on another occasion. Perhaps I ought to send this letter to the Under-Secretary and let him reply to it.
There is an unfair distribution of money for discretionary improvements. There ought to be a comparison between the practices of authorities to see whether some are fairer, or less unfair, than others in giving money. This is an important matter. It is rather like valuation in Scotland, although this criticism does not apply to England—we want some kind of referee to make sure that the discretionary grant system is reasonably fairly operated, even though by its nature it has a discretionary element which gives rise to variation.
I shall content myself with those remarks. We are anxious that Clause 3 should become part of the Bill, but I assume that the practice of fair rents will be radically considered, especially if the

Government are to found their new policy for the private sector on the fair rent system more formidably than before. In defence of the history of this matter I remind the Government that the improvement grant legislation came after the fair rent legislation and to that extent the latter did not anticipate what the former would be. Now it is to be done the other way round and we should look at the matter again.
If the Minister takes refuge in the argument, and I must confess that it is good argument, that the situation in England will be so diverse and fragmented because of the restriction, which we do not like, in the Bill in development and intermediate areas, let the argument stand : my hon. Friend the Member for Willesden, East (Mr. Freeson) can tackle that. But that argument cannot be used about Scotland, and it is important that the Under-Secretary should acknowledge that there is no such argument there.

Mr. McElhone: I, too, welcome housing improvements. Speaking parochially, it is a pity that in my constituency we could not have prevented many of the concrete jungles in our new municipal housing projects, as we could have done if many years ago we had had the foresight to have housing improvements. There is some fine tenemental property in the constituency and, with some foresight and the expenditure of some cash a decade or more ago, it could have been greatly improved, thus sparing the local authority and the Government many thousands of pounds.
What I fear about housing amenity is its sameness, the barrack type of dwelling, the monotonous type of construction which we seem to have perpetrated in our housing improvement schemes. There are reasons for this—the haste to build, the shortage of ground, the rush for housing, particularly in the post-war period.
Will £15 million be enough for Scotland considering that housing in Scotland is much more expensive than in the rest of the country and that, because of the higher standards which we set ourselves in housing, repairs and renovations and improvements are more expensive, too.
One of the main difficulties in implementing the scheme will be getting planning permission from local authorities.


If there is any major reconstruction to be done, it will certainly need planning permission. As often as not, because of the archaic system of planning controls, many months and sometimes years are taken up with getting planning permission. If we have a spate of planning proposals, the resulting delay and the fact that a scheme must be undertaken within two years of receiving planning permission will militate against people taking advantage of the money allocated to Scotland.
Does the Minister envisage any of the £46 million being spent on the older municipal housing estates? They were built in great haste because of the pressure for new housing and a great deal could be done to improve them, particularly in the peripheral areas of Glasgow where they lack amenity and are depressing places. Could part of the money be used to make them more pleasant? As rents increase and with transport difficult and expensive, they could become municipal deserts.
People may find it easier to purchase a home with a mortgage than live on these estates. In the older parts of my constituency people are living in tenement homes often without water and certainly without light for weeks and even months in some cases. It is not because they cannot get homes but because they are offered only houses in these peripheral areas which they are most reluctant to take. They would rather undergo these privations in the hope of getting a house which is more acceptable without the difficulties of travelling.
Would the Minister agree to the money being spent by local authorities on prewar obsolete housing because these homes contain a great fire risk which Glasgow local authority is dealing with. Obsolete electrical wiring, installed when people had only a radio and an iron, is one of the main reasons for the danger. Glasgow has over 100,000 municipal houses built in the 1919 period. Many families have put in extra plugs for fires, refrigerators and other appliances and this throws a burden on the circuit which it was never designed to take. The large number of fires in these homes have compelled many local authorities to take action, but some are reluctant to meet the challenge. I hope the money could be used to deal with this danger.
Another point which comes close to my heart is the question of improving the housing of the chronically sick and disabled. As I have told the House before, I am conducting a door-to-door survey in my constituency. It is now coming to a completion and is providing useful information. It shows the need for improvements and aids for many chronically sick and disabled people living in older property. Many of them would perhaps qualify under medical priority for new housing, but just as important as new housing is the companionship and friendship they have in their neighbourhood. Because of this, many of them are reluctant to take a new house. In many cases also, the older houses can be made perfectly adequate for them by the provision of a ramp or of a certain type of toilet, for example.
I hope that the Government will give more thought to this aspect, including perhaps the installation of warning systems which do not cause a great deal of money but allay the fears of disabled or chronically sick people living on their own and perhaps seeing only a home help for a couple of hours in the day. I would like to think that the right hon. Gentleman will have regard to the position of the chronically sick and disabled under the Bill. My survey suggests that the estimated figure of 270,000 people in Scotland with some form of disablement is a gross under-estimate by Government reports.
Perhaps the Minister could also allude to the problem of people living on long-term socia security benefits old-age pensioners and other people with small incomes qualifying for improvements. I would like to think that people in more necessitous circumstances could enjoy a little more comfort. As they do not qualify for new housing because of overcrowding or redevelopment, they have to endure many privations in the old-type tenemental dwellings. By arrangement with the local authorities or the Department of Health and Social Security, perhaps we could provide financial assistance under the Social Work (Scotland) Act which would benefit people living in such circumstances.
Many people will be reluctant to take advantage of this type of scheme because of their fear that their rent will go up. I do


not want to elaborate further on the lessons of the storm damage, but paramount in the success of a scheme like this is adequate supervision, because otherwise many unscrupulous operators could find in the system a gold mine in repair work, particularly on roofs, which is hard to estimate by the ordinary tenant or owner-occupier. I hope that there will some form of supervision so that the public money to be spent achieves everything that the Minister intends.
To many Tory councils with many prewar and rather ancient council houses under their control, this scheme could be a get-out whereby they can improve the property and then sell. It is a distinct possibility. Local authorities are not too happy with this type of dwelling, and under this Bill could improve it to the required standard and then, under the other legislation which, I am glad to say, is not working very well, could sell it, taking them out of the public housing stock. The 1957 Act caused a great deal of hardship. I hope that this Bill, by a more sophisticated means of increasing rents, is not the 1957 Act in another form. We must rethink the question of a fair rents policy. I support my colleagues on the Front Bench who have warned the Government that, while they may accept this Bill, the legislation which we are to have very shortly will come under the closest scrutiny and we shall try to ensure that the people we represent get the maximum advantage from what I think will be disastrous legislation.
I should like the Minister to give us assurances on this matter. I fear greatly—and it is a genuine fear which is shared by nearly all my hon. and right hon. Friends—that the statement on Scottish housing finance which we shall have later today, which will impose penal rent increases on many people, will discourage many people from taking part in any of these schemes. This Bill, involving £46 million for the whole of the United Kingdom, represents the tinsel concealing the package of real misery which future Tory housing legislation will bring.

Mr. Tom McMillan: I believe that the Clause will be welcomed in Scotland. It is an extension of the work carried out by the previous Administration. However, where I part company from the Govern-

ment is that they have not looked at the working of the previous legislation. Under previous legislation, people made beautiful houses more beautiful, which did not help to solve the housing problem in Scotland, especially in the Highlands. The two-year Clause in the Bill will help those in Glasgow's public sector no end, but the Bill will do nothing about the worst housing problem in the whole of Europe. The previous Administration wanted to see how their Bill worked with a view to adapting and changing it to suit the problems of Glasgow.
The first thing which we shall have to do in Glasgow in the private sector will be to get the people out of the huge tenement blocks. Only two-thirds of them will go back. It will take from 12 to 18 months to house them, and yet we must get the project finished in two years. What help will this be to Glasgow? We may offer people grants, but the outside structure of the buildings is such that they take a chance if they invest the Government's and their own money in them. I hope that the Minister will be able to point to some project in Glasgow where assistance has been given in two years. The Bill will not bring any relief in the sector in Scotland where it is most needed.
The previous Administration were wrong in not accepting Glasgow Corporation's proposal that the houses which stood in house treatment areas should be counted. I am now in the horrible position of being attacked by the council and by the Press for demolishing buildings and getting people housed, and I now have to run round saying "Keep the buildings up", because I have to make a survey for the houses to be treated. This is vitally important in my sector where about 25 per cent. of the houses are condemned and cleared. I am now sorry I cleared them.
2.15 a.m.
Will the Minister extend the two years to four years for Glasgow? Rehabilitation in a standard tenement means evacuation of the tenants, knocking three houses into two and building bathrooms. This is a long-term job taking about two years, and it would be of great assistance if four years could be allowed.
I do not fall out with the selling of houses, but I am concerned about the


rackets in Glasgow. A young couple about to be married went into the factor's office. They were offered a house for £400. On asking what its life was they were told to ring up the planning deptment of the Glasgow Corporation. They did so and were told that the house would not be redeveloped until 1980. The couple thought that they would get ten years out of the house, and they spent £300 on decorating it, only to find that it was condemned before they ever moved in. The house became dangerous, and on returning from their honeymoon they had to go to Forest Hall.
A huge property firm is involved in this racket. As soon as a tenement building becomes empty the firm buys it for £75 and then sells it for £400, when the life of the building is nothing.
A period of two years is useless and will do nothing to help Glasgow's housing problem. I hope the Minister will look carefully at this and, if not in this Bill, in a later Bill, bring in an extension in the private sector in Glasgow to give a longer term.

The Under-Secretary of State for Development, Scottish Office (Mr. George Younger): We have had an interesting and short debate, which has covered rather wider ground than the Clause we are discussing. The Clause does for Scotland what previously was done in the provision for England and Wales. There are no substantial differences in the Clause which differentiates it except that it is different in slight matters which are necessary to fit in with Scottish practice. There is special treatment for the Highland counties, which has always been the case, and this is preserved in the new grants.
The object of the Bill and of the Clause is to reinforce success. I have often in the past complimented the Labour Party on having brought in improvement grants in the 1969 Act. That Act is working extremely well and we believe that this dramatic increase in the money available will make an already good scheme work even better.
I was asked by the hon. Member for Glasgow, Central (Mr. Tom McMillan) whether the scheme could be extended beyond two years, particularly in regard to Glasgow. I am afraid that I must

say that we do not intend to do so. The whole point of the Bill and indeed of the Clause is to see that the work encouraged by these higher grants is concentrated in the next two years. I take the opportunity to urge everybody concerned with housing in Scotland owners—owner-occupiers, landlords and local authorities—to move now, and move quickly, to take advantage of the special two-year system which is being brought in with the express purpose of encouraging work to be done.

Mr. Tom McMillan: I know the hon. Gentleman means well, but possibly I did not get my point over to him. First, if we wish to rehabilitate people we have to rehouse them. Those people want corporation houses, and they want to go to particular places. This takes a long time, and by the time the people are rehoused, a year to eighteen months have gone before work has started. Two years means nothing to the people of Glasgow.

Mr. Younger: I should have resisted the temptation to give way. I was just about to cover the point made by the hon. Gentleman in his original speech. I would be the last person to underestimate the difficulties of improving properties ; every job tackled is different from the previous job. There is also the complication of multiple ownership and the difficulties which arise because people do not want to have their houses improved and will stick out and hold back other people. But accepting these difficulties—and they are probably schemes which will take longer to do—there are many cases in the City of Glasgow where work could be put in hand fairly quickly.

Mr. Tom McMillan: Name one.

Mr. Younger: No. There are many individual cases involving houses all over the city where work could be gone ahead with. The corporation has set up a special department to progress the house improvements programme, and I hope that it will do well and that the corporation will press ahead. Of course, there will be many cases which may be impossible to do within the time scale, but there are also many cases where work can be done quickly. It is up to everybody to get on with the job and to try to get it done.
The hon. Member for Greenock (Dr. Dickson Mabon) made a number of interesting points, many of which, as he said, will come up for discussion on other legislation. I do not want to go into them now, but I assure him that when we come to discuss housing legislation in general we shall be glad to look at any suggestions he would like to make for improving the system. We are agreed that this is a particular Bill which has a particular purpose and that this is not the place to debate, for example, the basis of fair rents or any other methods of housing policy. I take the hon. Gentleman's point and we shall be happy to look at any suggestion he cares to make.
The hon. Gentleman then raised the difficulties which are involved in improvement, which is a matter on which I have already touched. One of the main points in the 1969 Act was to give local authorities power to deal with unfit houses by improvement of the houses in an area. If a landlord refuses to improve his houses to the tolerable standard, or, indeed, if he does not co-operate with the other owner-occupiers or landlords in the area, the local authority can step in and acquire the houses for improvement if it so wishes. I recognise that this is sometimes difficult.
The hon. Gentleman referred particularly to page 4 of the booklet which we published about house improvement which relates to the 15 years life which is expected to be required. This is the normal requirement that can be made. However, local authorities can, if they wish, give standard grants for a lesser period down to seven years, and even less, with the consent of the Secretary of State.

Dr. Dickson Mabon: What about multiple-owned properties where one cannot say who is the owner of the stairs or the fabric above and below or the plumbing? This is important.

Mr. Younger: Local authorities can be flexible on these matters. The normal practice is 15 years. The hon. Gentleman will find that local authorities can be flexible to a certain extent and can also get permission from the Secretary of State in particular cases.
The hon. Member for Glasgow, Gorbals (Mr. McElhone) asked whether the total sum of £46 million for the United Kingdom as a whole could be spent on municipal estates. It certainly can. We are encouraging local authorities to modernise their stocks of municipal houses, and a substantial number have been and are being done. The statistics show that out of a total of 17,508 houses in local authority improvement schemes in 1970, 15,429 were done to houses built with subsidy. Grant is available for putting in an adequate electrical power supply, and it has been used for this purpose in a large number of cases.
The hon. Member for Glasgow, Gorbals also referred to houses being specially adapted for the disabled and chronic sick. We all know of his interest in these matters. If a house owned by a disabled person qualified for an improvement grant and, because of that person's particular handicap, a more expensive type of fixture was required—for instance, a recessed or sunken bath—the local authority has power to grant-aid the cost of the more expensive fixture. I hope that local authorities will do this in cases of such need, and I shall do whatever I can to encourage them to do so.

Mr. McElhone: I mentioned modernising old municipal houses, especially in Tory-controlled local authorities, and such houses being sold. I am concerned about the principle of the matter. I think there is a great deal of sympathy for the point expressed by my hon. Friend the Member for Salford, East (Mr. Frank Allaun). Has the Minister any observations to make on that point?

Mr. Younger: I want to be brief. This question goes much wider than the Clause. It is most unlikely that a local authority, controlled by any party, would want to go to the trouble, expense and difficulty of improving houses, for which it gets a grant in the form of a Government subsidy over many years, and then sell them for a "quick profit". In any case, the proposals which are in train for the sale of council houses apply to sales to sitting tenants, not sales of vacant houses to anyone who comes along, unless there is no waiting list in the area and then only by special permission of


the Secretary of State. Although it is technically possible, I think that it is a most unlikely thing to happen. This is a matter which we can look into in due course.
I do not agree with the hon. Member for Glasgow, Central when he says that the Bill will do nothing for Glasgow. Glasgow's programme, agreed to by all the parties concerned, is to try to improve no fewer than 10,000 houses by 1980. That is a formidable task, and though it has got under way well, it is a long way from being guaranteed to achieve 1,000 houses a year, which is needed if the targets are to be met.
I believe that the Bill will provide a splendid impetus to Glasgow's programme to improve 1,000 houses a year over the next ten years. Many people in Glasgow will look at the Bill in that way, and they will have every help to get the improvements under way. I hope that the Committee will approve the Clause, just as I hope the House will approve the Bill in due course.

2.30 a.m.

Mr. Ross: I rise only because of some of the comments of the hon. Gentleman about the Measure of which I was the author. I am happy that the hon. Gentleman paid tribute to what was done, because most of the improvements that have been carried out to houses have been done under the provisions of that Act. I notice that hon. Gentlemen opposite are always careful not to mention their 1964 Act, which was going to solve all these problems. I do not suppose the hon. Gentleman knows anything about it. If he is frank, he may say that he does not. It was never used. Hon. Gentlemen opposite do not have a very bright past in this matter, and it would be as well if they were to listen to some of the criticisms advanced by my hon. Friends about this Bill.
My hon. Friend the Member for Glasgow, Central (Mr. Tom McMillan) spoke about the special position of Glasgow in relation to the limitation of the period, but he was not talking about the same kind of houses as the hon. Gentleman was. The position of these tenemental properties is unique. There is the special position of multi-ownership and of varied ownership. Some are owner-occupied, while others are tenant occupied, and it

is sometimes extremely difficult to get agreement to do some of the things about which my hon. Friend spoke. I think that there was a misunderstanding about the intervention of my hon. Friend the Member for Greenock (Dr. Dickson Mabon).
It is tragic that the Bill is being debated at this hour. It should not have been taken in a Committee of the whole House. It should have been considered in Committee upstairs, followed by a Report stage in the House. I am sure that some reasonable Amendments, if not the four years for which my hon. Friend has asked, could have been accepted.
It would have been helpful if the Bill had not contained this provision about the work having to be completed within two years. After all, it is now 14th July, and the Bill is not yet an Act, yet its provisions take effect from 23rd June. Does the Minister think that the people concerned know about the Bill? The right hon. Gentleman expresses the hope that they do, but if there had been more time in which to consider the Bill there would be no doubt about that. The Government have been late in introducing the Bill to achieve the maximum effect.
Every city in Scotland is affected, because the whole of Scotland is either a development area or an intermediate area, and therefore the Bill covers both Edinburgh and Glasgow. Will the Minister ask local authorities how long it will take them to process some of the work that he wants them to do? I am sure that they do not have rolling plans for improvements, even though I should like to think that they have.
The Minister is limiting the beneficial effects which we all want to achieve by limiting the period. If, instead of saying that the works had to be completed before the expiration of two years, he had said that they had to be started within that period, that would have provided a certain amount of overlap. That is a reasonable Amendment and I would be prepared to move it if the hon. Gentleman is prepared to accept it. It has been done before. I managed to achieve it during the passage of the Caravans (Site and Control of Development) Act in 1960.
If hon. Gentlemen would come here more often they would learn how to do


things. These benches should be packed instead of merely Famine, Death and Pestilence in the form of the three hon. and right hon. Gentlemen on the Government Front Bench giving us the benefit of their knowledge about housing improvement in England, Scotland and Wales. I am disappointed that the Secretary of State for Wales, or his representative is not here. The hon. Gentleman has under-estimated the problems of the private sector in Scotland.
When I was Secretary of State I was concerned about the extent to which we were spending money, not just repairing storm damage but the damage of generations. My hon. Friend the Member for Greenock, who was Minister of State then and who handled, very well, the problems of storm damage in Scotland will bear me out. I was concerned that some of the properties would be sold.

Mr. Tom McMillan: They have been.

Mr. Ross: I felt then that some Bill should be introduced to stop this. I do not know whether the hon. Gentleman has investigated the extent to which people have repaid Glasgow for the money spent. I was being attacked at that time by hon. Members opposite because this was not being pushed enough. I was told, "Make this a wartime effort, spare nothing". We are getting very little back from these people.
If a local authority exercises its power to improve a house there is nothing on earth to prevent it from selling that house in the same way as any other house. It is to be hoped that it gets a better price from the sitting tenant. The hon. Gentleman spoke about the Secretary of State exercising authority if there is no waiting list in the area. I am glad to hear that. I wonder whether his right hon. Friend agrees. As far as I know they were prepared to sell any local authority property, irrespective of the sitting tenant or the waiting list. The whole idea is to sell to sitting tenants, not to empty council houses to sell them. I do not want to prolong this but the hon. Gentleman should be more careful about the words he uses, even at this time of night.

Mr. Younger: The right hon. Gentleman has not heard correctly. The ques-

tion whether there was a waiting list refers to any request to sell a vacant council house and not to sell houses to a sitting tenant. That is the difference.

Mr. Ross: I have a bad habit of writing down what hon. Members say. The hon. Gentleman did not say that. He did not get it right. I have no doubt that suitable changes will be made—I hope they will be—to ensure that nobody who reads what the Minister said will be misled by his words.
In general, we wish the Clause well because we want to see these improvements made. I only regret that it is limited to a two-year period, with a carryover in respect of expenditure incurred. My hon. Friends and I would have liked to have spoken at length on a number of issues raised by several Amendments that we had tabled, but because of the hour and other considerations, we are having to curtail our remarks.
We could have spent a great deal of time speaking about fair rents. What about the Francis Committee? The Lone Ranger, if I may call him that—the one Scottish member of that Committee—would certainly not have accepted every dot and comma of its Report as being applicable to the Scottish position. We could do with some more information about that, but I suppose that can wait until we debate our new Scottish tartan version tomorrow. Meanwhile, I advise my hon. Friends not to oppose the Clause, despite its shortcomings.

Question put and agreed to.

Clause 3 ordered to stand part of the Bill.

Clauses 4 and 5 ordered to stand part of the Bill.

New Clause 2

ALTERATION OF AMOUNT OF IMPROVEMENT GRANT OR IMPROVEMENT CONTRIBUTION

The Minister may, with the consent of the Treasury, by order substitute another amount for the amount of £1,000 mentioned in subsection (2)(a) and for the amount of £1,200 mentioned in subsection (2)(b) of section 5 of the Housing Act 1969 and a statutory instrument containing such an order shall be subject to annulment in pursuance of a resolution of the Commons House of Parliament.—[Mr. Freeson.]

Brought up, and read the First time.

2.45 a.m.

Mr. Freeson: I beg to move, That the Clause be read a Second time.
This new Clause seeks to establish in legislation a power in respect of improvement grants which is similar to that existing in Clause 37 for amenity grants to general improvement areas. I need not speak at length on this subject because the subject matter has been dealt with, at any rate to a reasonable extent, in discussing earlier parts of the Bill.
It has been made clear that the Government feel that Section 5(3) of the 1969 Act contains the power which the new Clause wishes to establish. But that provision lays down that any increase of the upper ceiling of expenditure allowable for grant calculation purposes can be authorised by the Minister only at the request of a local authority. Do I see the Minister indicating dissent?

Mr. Channon: No.

Mr. Freeson: Whatever he was indicating, he will agree that his right hon. Friend would not, out of the blue, initiate an increase in the ceiling. I do not argue with that provision in the 1969 Act and I am anxious to preserve some flexibility in this legislation. But it is a flexibility which is applicable, as the subsection says, to a particular case or class of case.
I am seeking to establish something rather more broadly based than that. I seek to establish that the Minister may have the power to do what all of us have agreed in Committee should be the position, that is, a power generally to increase the allowable ceiling for grant-aided expenditure. There is no power in the Act, or in the Bill which amends the Act, to enable such a general increase in the ceiling of grants to be introduced by the Minister on an Order placed before the House. I make that reference because earlier the Parliamentary Secretary said that the Minister could introduce an Order. Even subsection (3) as it stands makes no reference to an Order being placed before the House. It states that he may agree, on requests being made to him by a local authority in particular cases or a class of case, that there is a need for a variation in what is still the generally accepted ceiling.
I repeat, nowhere in the Act is there a discretionary power on the part of the

Minister to introduce a general review. That being so, legislatively we are in the position that we were in prior to the Housing Act 1969, and this is one of the weaknesses to which my hon. Friend the Member for Greenock (Dr. Dickson Mabon) has referred. He indicated that there is a need to look at the operation of the Act and to fill it out to the extent that the Act is not as good as it should be.
There is no way round this. The Act does not give the Minister a general power. It gives him the power to vary the position in a class of case or a particular case. We all welcome that, and I do not question it. But I seek to establish clearly and specifically in the Bill that the Minister may introduce a general variation, an increase, in the ceiling of allowable expenditure for calculation for grant purposes, instead of just having the discretionary power to vary the position in a particular case or class of case. A "particular class of case" and "particular case" cannot mean all housing improvements, and it is that power which I seek to establish.
As my penultimate point, I put the matter this way. If it is the view of the Under-Secretary and the Minister that they do not need this power, that it is something which they would not wish to have the power to do, or that it is implicit in the Bill or is to be found somehow in an interpretation of the Act, as distinct from a specific explicit statement in legislation, there can be no argument against the new Clause. It means that the Minister and the Under-Secretary agree with the principle I am enunciating.
On expenditure in connection with amenity improvements in general improvement areas, in Section 37 of the Act we have already a subsection which is virtually identical to the new Clause, within the context of general improvement area amenity grants. If both sides wish to have the same general power in the Minister's hands in connection with specific improvement grants as the Minister already has in connection with amenity grants in Section 37(5), there is a clear case for having it written explicitly into the Act. We all agree that there should be such a power.
I argue that the Minister's present power is limited by Statute and that, if he


sought to extend Section 5(3) by a general increase in grant levels or in the ceiling on expenditure for grant calculation, this would or could be ruled to be ultra vires. If this view is sound, as I believe it to be, it becomes even more essential that the Clause be accepted. The whole basis for tabling the Clause is not merely that I think that this is a missing element from the 1969 Act, but that we have seen evidence of steeply rising costs and, if we are to accept the view, as perforce we have to, expressed by the Under-Secretary earlier that there is at present no case for increasing these figures specifically, the Minister needs the power to vary expenditure when the Government come to the conclusion that there is an urgent need to do something which there was not the power to do under the previous legislation dealing with improvement grants : hence the drop in value under the 1949 Act.
These are my various reasons. I want to introduce into the legislation governing improvement grants on individual properties the same power as already applies on the more limited level of expenditure with regard to amenity grants for general improvement areas. There can be no argument against the principle. I look forward to hearing how it can be explained that subsection (3) gives this general power when it refers to particular cases or classes of cases.

Mr. Amery: I take it that this is not a probing Amendment but is a genuine attempt to improve the Bill.

Mr. Freeson: Yes.

Mr. Amery: The objective is certainly a laudable one with which I have great sympathy. The objective is to give the Minister power to increase by Order the cash limits of improvement grants paid by local authorities to private owners under Section 5 of the Housing Act, 1969. It is true that, unless these existing limits are raised, they would have the effect of restricting the extent of the financial assistance given by the Act. For instance, an owner spending £2,000 on improving his house, and who would apparently be eligible for a 75 per cent. grant of £1,500 under the new provisions, would find himself subject to the existing limit of £1,000 on his improvement grant. The Secretary of State already has the power

to make Regulations, although these could apply only generally throughout the country.
The hon. Gentleman may have overlooked Section 5(2) of the 1969 Act. Section 5(2) provides that the improvement grant limits shall be £1,000, or £1,200 in the case of properties of three or more storeys,
or such other amount as may be prescribed".
Section 27 defines "prescribed" as meaning,
prescribed by regulations made by the Minister".
Section 85 provides that any regulations under the Act shall be made by Statutory Instrument, in the case of regulations under Section 5(2) subject to the negative procedure.
In order to deal selectively with the areas to which the Bill applies—this is the problem we are up against now—the Secretary of State intends to adopt the method available to him under Section 5(3) of the 1969 Act, which enables him to approve higher amounts of grant for particular cases or particular classes of case. He will in due course approve higher amounts of £1,500 instead of £1,000 in Section 5(2)(a) and £1,800 instead of £1,200 in Section 5(2)(b). The approval will be included in the Circular to be sent to local authorities as soon as the Bill has been passed.
As the point is already covered under the existing arrangements, I hope that the hon. Gentleman will agree that there is no need to pursue his new Clause.

Mr. Freeson: Before agreeing to his request not to press the Clause, may I put this specific question to the Minister? Should he or any future Minister wish to vary the grant levels throughout the country, not just in specific cases but generally under the Bill or in other circumstances, has he the power to do so?

Mr. Amery: That is my understanding, under Section 5(2).

Mr. Freeson: As this is a serious matter, and the right hon. Gentleman accepts that I have raised it in all seriousness for the purpose of clarification, may we have an undertaking that he will look at the question again between now and the time when the Bill goes to the other place, so that there will be no doubt on this score?

Mr. Amery: I am not giving this off the cuff. In my view, there is no doubt, but we shall look again in case there is the slighest margin of doubt. As far as I am aware, there is no doubt whatever touching the assurance which I have given.

Mr. Freeson: I beg to ask leave to withdraw the Clause.

Motion and Clause, by leave, withdrawn.

Bill reported, as amended ; as amended, considered.

Mr. Deputy Speaker (Sir Robert Grant-Ferris): I have to announce that Mr. Speaker has selected the two manuscript Amendments in the name of the hon. Member for Willesden, East (Mr. Freeson).

Clause 1

HOUSING IMPROVEMENT IN DEVELOPMENT AND INTERMEDIATE AREAS

3.0 a.m.

Mr. Freeson: I beg to move, in page 1, line 14, after "works", insert "or expenditure".
Linked with that Amendment is the second Amendment, also in page 1, line 14, after "completed", insert "or incurred".
Our original suggestion, to replace "completed" with "approved", was not accepted as being in order. The matter has been raised in debate time and time again as a serious point. It was raised in the past 10 minutes by hon. Members representing Scottish constituencies, when we debated Clause 3.
There can be no doubt that we cannot rely in practice simply on works being physically completed, if we are to get the effect that we all want from the Bill. In addition to the views expressed by hon. Members we have had representations from the National Federation of Building Trades Employers, which urged that we should seek to have "completed" replaced by "approved". That could not be done, but probably the phraseology of this Amendment is better and more accurate, and I should have been wiser to use it in the first place. I seek now to use the language to be found in the Money Reso-

lution, in which there is an either-or situation, otherwise the expression
completed or incurred
would not have been found necessary.
I can only assume that in accepting that Resolution Parliament has agreed that public money should be spent under the terms of the Bill not only for completed works but for works which have not taken place but on which expenditure has been incurred. To make sure about my interpretation of "incur" I consulted our old friend, the Longer Oxford Dictionary. The definition that concerns us now is :
to render oneself liable to ; to be liable through one's own action ; to bring upon oneself …
If the Government accept the Amendment they will agree to the Bill's applying wherever work has been agreed to—by whatever legal or physical process, must be interpreted in law—and which results in an incurring of expenditure, and that it is not the actual completion of works which constitutes the incurring. It may seem light-hearted to look up dictionary definitions, but I thought it was well to put on record that I had checked the meaning.
The Amendment is fully in line with what we all seek in the Bill and with the Money Resolution. Whatever other views the Government have been unable to accept, I hope that they will at least accept this Amendment so that they and the local authorities can take the start of works for the purposes of the increased grant aid. Otherwise, as hon. Members have said and as the National Federation of Building Trades Employers has represented to hon. Members, there is likely to be a slow down in work in the last six months' operation of the Bill, and local authorities and others dealing with particularly difficult circumstances in those areas of housing which are most urgently in need of help under the Bill—Glasgow, London and other big cities and some of the worst areas within the intermediate and development areas—will find that the Bill is not operative in the latter part of its life.
I do not propose to repeat our arguments that the Bill is narrowly drawn and that there are other stress areas which should benefit as will Glasgow, for we have already discussed these matters, but it must be our job to ensure that, within


its present limits, the Bill makes money available to increase expenditure to achieve our purposes. We shall have been wasting our time and just playing around with the subject if the Bill can produce results on the ground for only six to twelve months.
I say that to underline what has already been said by hon. Members on both sides of the House on Second Reading and in Committee. The Amendment is in the terms of the Money Resolution and I hope that it will be accepted so that the Bill will be operated in the spirit which we want.

Mr. Channon: I congratulate the hon. Member for Willesden, East (Mr. Freeson) on ingeniously finding a formula for getting his Amendment within the terms of the Money Resolution and thus being able to raise the issue which he wanted to discuss. I congratulate him because the words "or incurred" occur in the Money Resolution, and we all recall the interesting debate we had on the Money Resolution on Friday.
The words "or incurred" in the Money Resolution refer in particular to Clause 2(2)—
So far as expeneature eligible for assistance under the said section 37 consists of expenditure on providing land, this Act shall apply as if the expenditure were expenditure on works so eligible carried out on land and completed at the time when the expenditure was incurred, and as if the application for financial assistance had been made at that time.
Some works necessitate local authorities acquiring land, and for the purposes of the Bill the date of the acquisition of the land, when the authority has incurred the expenditure, will be deemed to be the date when the works will have been completed, or otherwise none of this would rank for the higher grant.
That is why the words "or incurred" appear in the Money Resolution and that is what it means when it uses the words "completed or incurred".

Mr. Freeson: Before we get too far along this road, and we have gone far enough already, the hon. Member is misrepresenting the position. The Money Resolution cannot be restricted as he suggests. The fact that that was in the Minister's mind when the Money Resolution was drawn up—that it related to a particular point in the Bill—is not the

point now before us. The Amendment is in order and, if passed, it would mean that the Money Resolution would cover expenditure incurred on other matters. Nothing in the Money Resolution relates to expenditure incurred on the purchase of land and the hon. Gentleman is pursuing a false point. He may wish to argue substantively on the point but I hope that he will accept the arguments put on both sides of the House and from outside before we finish tonight.

Mr. Channon: I will deal with the point the hon. Gentleman made. I was explaining the Money Resolution. Whether the Amendment, if passed, would have the effect he wishes is another question.
There is some doubt—I put it no higher—about the effect of the Amendment if carried. No one can complain about that. It is extremely difficult to draft Amendments to Bills. I am advised, however, that the Amendment would not have the effect the hon. Gentleman desires.

Mr. Freeson: In law?

Mr. Channon: Yes. I do not make a particular point of it but it is important. We cannot be categorically certain that this is so, but there is doubt, and in law it may be that the point at which expenditure is incurred is the point at which the builder is paid. If the courts put that interpretation on it, then what the hon. Gentleman is seeking would not be achieved. It would probably have the opposite effect and would not help his case.
The substantial point he is making concerns why we fixed the two-year period and why we decided on completions rather than starts or approvals.
I am not sure I can give an answer which will satisfy the hon. Member or whether there is any statistical or logical basis on which one could defend what we have done. Whether it should have been approvals or completions is a matter for argument. We might have said it should have been approvals within 18 months or completions within two or three years. Whatever time limit was chosen, the Opposition and hon. Members on this side would have been entitled to question the logic behind it.
The Minister decided that this policy needed a short-term boost. We wanted a short, quick spurt to bring forward the maximum amount of work that could be achieved within a limited period. Only time will tell whether we have adopted the right period. But we decided to have it on completions rather than approvals because it was much more likely to get the work brought forward as quickly as possible if it were known that it had to be completed within a stated period. That was the argument which influenced my right hon. Friend.
3.15 a.m.
I believe that a lot can be done in this period. Wherever I have been in the development areas since this scheme was put forward, I have found great enthusiasm and a wish to get on with the job. I have not been to Scotland but my hon. Friend the Under-Secretary of State tells me that the same applies there. My right hon. Friend and I have been to a considerable proportion of the development and intermediate areas since the introduction of the Bill and, as I have said, we have found great enthusiasm. We want to get people moving now. We believe that they are beginning to move and that there is great interest. The hon. Member for Greenock (Dr. Dickson Mabon) asked earlier whether people knew about the scheme. A lot of people certainly do and I think that the arrangements for letting people know about it are satisfactory. If they are not, we shall take the necessary steps.
I cannot say that there is any statistical or absolutely logical reason for having a two-year period rather than, say, three years, or for having completions rather than approvals. But we believe that this is a satisfactory way of tackling the problem and getting a quick, short, sharp spurt in order to achieve as quickly as possible as much work as can be achieved in these two years.
This being so, I cannot advise acceptance of the Amendment, although I would like to do so. I could not advise it even if I wished to meet the hon. Gentleman's point because there is doubt about the legal position. I believe, however, that we have a satisfactory basis in the

Bill. The House will have an opportunity to judge our success when the time comes. I know that hon. Members hope the scheme will be successful. We are more likely to get on quickly if we go for completions rather than approvals within a certain period. At the meetings which my right hon. Friend and I have had, the local authorities and the builders have not complained about either the proviso on completions or the time limit. I believe that we can get a substantial amount of work done in the time scale we are laying down. I cannot meet the hon. Gentleman's case on strict statistical or logical grounds, but I hope he will see that there is sense in what we propose and will not press the Amendment.

Mr. Freeson: We have argued this point many times and have been unable to persuade the Government. They have made up their minds not to consider the matter further. I believe that, as a result of the Government's insistence on the Bill in its present form, we shall get a very short burst of activity and that it will be well within the two years. I think that the National Federation of Building Trades Employers, the A.M.C. and we are right and the Government are wrong on this point and that the Government are undermining the purposes of the Bill by their rigid attitude. However, there is no point in arguing the matter further, since there is no sign of movement by the Government on it. But I believe that they will regret their attitude as they see its effects.

Amendment negatived.

Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 56 (Third Reading), and agreed to.

Bill accordingly read the Third time, and passed.

MINERAL WORKINGS (OFFSHORE INSTALLATIONS) BILL [Lords]

Order for consideration as amended (in the Standing Committee), read.

Bill to be considered this day.

CORSBIE HALL SCHOOL, THORNTON

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Hawkins.]

3.19 a.m.

Mr. William Hamilton: I make no apology for initiating a debate on this school in Fife at this hour of the morning. The school was first drawn to my attention in the early part of this year by a young lady investigator from Granada Television. She went there from Manchester because she had been told that children were attending the school from North-West England and that conditions were not satisfactory. She painted a lurid picture to me about it. That was my first knowledge of the existence of the school. Nobody locally seemed to know very much about it, although it is only a mile or so from the village of Thornton, which I know very well.
Subsequent to my discussion of the school with the young lady from Granada, I made an immediate request to the principal of the school, Mr. G. F. Taylor Bryant, to visit the school. My request was readily acceded to, and I visited the school, along with my agent who lives in Thornton, on Sunday, 31st January. What I saw disturbed me quite a bit.
For a long number of years the building was used as a fever isolation hospital. It was subsequently used as an institution for mental defectives and was known at that time as Strathore Hospital. In December, 1964, the mental health subcommittee of the Scottish South-East Regional Hospital Board advised that when the new hospital for mental patients became available in Dunfermline in 1967 Strathore would no longer be needed and a decision had then to be taken as to the future use of Strathore Hospital.
The regional engineer and the regional architect meantime had reported that about £150,000 would be needed to bring the buildings up to modern standards, and in a report dated June, 1965, a copy of which I have with me, the regional architect's division reported, among other things, that the general condition of

the buildings was good but 50 per cent. of the sanitary fittings were badly worn ; 70 per cent. of the rooms needed decoration and plaster repair ; the laundry was no longer used as such and little maintenance had been done on it for a long time ; that there was a 58-year-old hand-fired steam boiler which was inefficient and in very poor condition ; that the internal heating system was far below modern standards and
with reasonable ventilation conditions would be quite inadequate".
Also, the internal electrical system was inadequate in design, although there had been some rewiring to the extent of 75 per cent. in the last few years for the provision of power and light. There was no incinerator. It is a remarkable comment on the way the hospital had been run by a public body for mentally retarded children.
However, the building was vacated by the South-East Regional Hospital Board and remained empty for a considerable time—no doubt the Under-Secretary of State has the exact date—I think from some time in 1967 to September, 1970. In that period, when the buildings were completely empty, the deterioration must have been considerable. Fife County Council considered using it as an agricultural college, I believe. I am not sure about that, but it does not matter for the purposes of the argument. Fife County Council rejected it on the ground of cost ; it would be much too costly to make it into anything of worthwhile use to it.
Subsequently the buildings were advertised, by whom I know not. They were purchased by Mr. Taylor Bryant of Edinburgh, agent and solicitor. I ask the Minister, by whom was the advertising done? From whom was the purchase made? Was it purchased from the regional hospital board, or was the transaction done through the Scottish Office? Did the vendor know to what use the buildings would be put? Did Fife County Council know? Was planning permission needed? Was it sought and was it given by Fife County Council.
I have never said anything personally against Mr. Taylor Bryant, the purchaser. I believe that he is interested in child care work, and I understood him to say that he had done about ten years' child


care work, mostly in Devon and Cambridge, but he has no qualifications whatever for the work, either academic or otherwise, and, indeed, he made no claim to them when I spoke to him. He said that he was the administrator of the business, and his plan was to run the place as a private fee-paying school for mentally and socially disturbed children. I will quote from the brochure, which the Minister might have seen—the inspectors must have seen it :
Corsbie Hall School, Newton Stewart, Wigtownshire Corsbie Hall School, Thornton, Kirkcaldy, Fife
That is the one in my constituency. There are ambitious and misleading statements in that brochure. The back page relates to the Fife school, and says :
Corsbie Hall School (Fife) is an annexe to Corsbie Hall School, Newton Stewart, and provides a further 60 places for maladjusted and mentally handicapped boys from 6–16 years of age. It is run on identical lines as Newton Stewart and will in fact be the main administrative centre for the two schools. The new school will have its own psychological testing and assessment unit employing a full-time psychologist, it will also have its own social worker, and both these departments will operate between the two schools. The staff of the new school will consist of Principal, Deputy Head, Psychologist, Qualified Teachers, Matron, Houseparents, Social Worker and Domestic and Maintenance Staff. Opening date 16th September 1970. Fee : …… per annum to include school uniform.
That brochure was circulated to local education authorities throughout the United Kingdom. When I visited the school last January I saw physical improvements in the buildings. A new oil-fired central heating system had been installed. Several new showerbaths and washbasins had been installed. The old hospital wards had been divided into small dormitories each containing four single beds, which appeared to be reasonably clean. Clearly, some money had been spent, and no wonder, because the fees, although not stated in the brochure, are in fact £820 per child, payable by the local education authorities.
When I visited the school last January it had been open only since the previous September, as the brochure says, and I was told that the number of boys was 53. It may be more, or less, at the moment, I think rather less. I was told that 70 boys had been applied for from all over the United Kingdom—from Man-

chester, Oldham, Bolton, South Shields, the North and West Ridings of Yorkshire and most Scottish local education authorities. This information was given to me by Mr. Taylor Bryant. The fees were not mentioned in the brochure, but they are £820 a year, with the promise, or threat, of a further increase at an early date, all of which is paid by the local education authorities concerned.
I was given no clear indication of how the boys were selected or graded for the school. I was told that at least two boys were there following court orders. I do not know whether they were mentally retarded, socially maladjusted or what, but they were there. There was a mixture of all kinds of children with I.Q.s ranging from 60 to 100.
So far as teachers are concerned, when I was there I saw a Mr. Sendall, the headmaster, who had arrived about three weeks previously. I asked what qualifications he had and he said that he was a qualified teacher but with no qualifications to deal with this particular type of child. The same applied to other teachers. At least one was not qualified in any way whatever. There was little evidence, so far as I could see, of any written work and, as an ex-teacher, I had some idea of what to look for. There was little evidence of any equipment in the gymnasium, there were few visual aids ; there was no library. There was no visiting psychiatrist, though I was told that a Dr. Evan Jones, of Cupar, was the visiting psychiatrist. There was little evidence, nor is there yet, that he was or is a regular visitor. There was certainly no evidence of a psychologist or of a social worker.
At one point in our conversation I remember that Mr. Sendall, the headmaster, referred to the children as "savages"—those were his words—who engaged in brutal behaviour. He used that language as justification for their use of corporal punishment. I left that school on that Sunday with a heavy heart and with anxieties for the children in that building.
I wrote to the Scottish Department on 2nd February, having telephoned the previous day. I must admit that the Department replied very quickly on 4th February and confirmed that the school


had been inspected, as Mr. Taylor Bryant had told me, on Friday, 22nd January, 1970 ; although Mr. Taylor Bryant told me that that was the final inspection before official registration. The letter from the Secretary of State dated 4th February indicated that it was not the final inspection. I quote one sentence from the Secretary of State's letter :
I do assure you that the need for urgency in dealing with cases of this kind is fully appreciated and I am asking the inspectors to let me have their report as soon as they can.
So, the right hon. Gentleman recognised the urgency of the matter as long ago as 4th February.
I asked the Secretary of State in my letter to get in touch with all the local education authorities in Scotland who had children at that school, but he refused to do that. He said that it was up to local education authorities to satisfy themselves as to the suitability of the establishments to which they were sending their handicapped children.
I wrote a further letter to the Secretary of State on 5th March, and I would draw attention to one part of his reply on 30th March :
The reports of the inspections show that there are undoubtedly many unsatisfactory features about the school and that much will require to be done both organisationally and structurally before a satisfactory standard is achieved.… My Department has therefore now written to the proprietor setting out in detail the various aspects which should receive urgent attention, and it is intended to carry out a further round of inspections in two or three months time.
I then tabled a Question to the Prime Minister on the general question of mentally handicapped children. Following the oral exchanges in the House, I then received a letter from the Prime Minister on 23rd March. In that letter to me he gave the numbers of severely handicapped children :
There are estimated to be about 50,000 mentally handicapped children in England and Wales, and about 5,000 in Scotland. About 63,000 children of school age have been classified as educationally subnormal in England and Wales and about 7,500 in a similar category in Scotland.
The right hon. Gentleman went on to deal with the research which had been going on, and ended by saying :

As with the mentally handicapped, these special studies "—
he was referring to the studies in 1966 and 1969—
suggest that there is considerable need for special educational facilities for maladjusted school children which has not yet been met. These findings are proving very valuable in the planning of future developments.
That was helpful as far as it went. I followed that with subsequent Questions to the Secretary of State. On 24th February, 1971, the right hon. Gentleman indicated that there were nine registered independent schools in Scotland with about 430 places for mentally retarded children, one of which—I presume one of the nine, or it might have been in addition—was provisionally registered at that point.
I put a further Question on 17th March, 1971, to which the Answer was that there was still no final decision as to registration.
So, on 23rd June, 1971, I put a further Question on inspection. I was told that substantial progress has been made, that most physical improvements had been completed in the school, although there were still some weaknesses in staffing, and that there would be another inspection in three months. That was the point at which I expressed my anger at the reply, because I recalled the letter of 8th February in which the Secretary of State had said that he recognised the urgency of the case. That was four months before, and there was to be another three months delay before a subsequent inspection. That answer left me—I was going to say speechless with rage, but I am never in that state.
I had also been in touch with the Secretary of State for Education and Science. On 4th March, 1971, I specifically asked the right hon. Lady about English children at this school, Corsbie Hall, and she indicated that at that time there were three local education authorities in England—Manchester, Bolton and Oldham—which had children there with her approval. That conflicted with the information which I had been given by Mr. Taylor Bryant, the principal of Corsbie Hall school. Now, either the right hon. Lady had been misinformed, Mr. Taylor Bryant had misinformed me, or the other English local education


authorities had sent children there without Ministerial knowledge or approval. That is not for the Under-Secretary to answer, but I make the point that there was some misleading of somebody somewhere.
The right hon. Lady also indicated that she had sought advice from the inspectorate of the Scottish Education Department, so that Department thought that the school was sufficiently adequate for children to be sent all the way there from Manchester, Oldham and Bolton.
I tabled another Question to the English Minister on 1st April, 1971. In her reply she indicated that seven of the boys placed at the school by English local education authorities had been withdrawn by their parents—apparently the parents had visited the school, found things they did not like, and had withdrawn their children—but that four English local education authorities were still sending pupils to the school. The right hon. Lady said that she was considering the future position.
In early June, following reports that the Secretary of State for Education and Science had advised the English local education authorities to withdraw all their mentally disturbed children from Corsbie Hall School, I tabled a further Question on 10th June to the English Minister. I asked why she had advised these local education authorities to withdraw their children from this school and whether she intended such withdrawals to be permanent, or until such time as the school was brought up to minimum requirements as to premises and staff, and the right hon. Lady replied :
I reached this conclusion after considering a report by inspectors of the Scottish Education Department. If the situation at the school changes I should naturally be prepared to reconsider the matter."—[OFFICIAL REPORT, 10th June, 1971 ; Vol. 818, c. 352–3.
I am sorry that I am taking up so much time, but I want to get these facts on the record, and if the hon. Gentleman does not have time to reply I hope that he will do me the courtesy of writing to me, because I intend to press this matter to the utmost.
It was the substance of the right hon. Lady's reply which disturbed and angered

me when I heard the Scottish Minister's reply to my Question on 23rd June. It amounted to saying that although in the view of the English Minister for Education Corsbie Hall School was unfit for English mentally handicapped children, according to the advice given by the Scottish inspectorate it was apparently good enough for Scottish mentally handicapped children.
Presumably the Government were acting on the basis of local education authorities and local authorities having the freedom to do what they liked. Let us remember that that was the philosophy annunciated as soon as the Conservative Government took office. No doubt the Minister was seeking refuge—indeed, he said so—in his reply to my supplementary question by saying that he had no power to direct local education authorities in Scotland to withdraw their children from this school, he could only advise them to do so. He was seeking refuge in Part V of the 1962 Education (Scotland) Act dealing with independent schools.
What action has the hon. Gentleman taken in compliance with Section 112 of that Act which deals with notification to the proprietor of objections about the suitability of the premises, the efficiency and suitability of the instruction and the quality of the teaching? What steps has he taken to ascertain whether the Scottish local education authorities have satisfied themselves about the adequacy of the provision at this school?
What dissatisfied the English Minister which apparently does not dissatisfy the Scottish Education Department? I make no personal charge against the proprietor at Corsbie Hall, nor against anyone running the institution, but I charge the Scottish Education Department with almost criminal complacency in this matter.

The Under-Secretary of State for Health and Education, Scottish Office (Mr. Edward Taylor): If the hon. Member intends to make that charge, I hope that he will allow me a few minutes in which to reply.

Mr. Hamilton: I shall conclude my speech in half a minute from now. Had the hon. Member not intervened, I should have concluded it.
I believe that the Scottish local education authorities have failed to discharge their proper responsibilities in dealing with an under-privileged, inarticulate minority in the community. I am firmly of the view that the education of mentally handicapped children must never be left in the hands of private persons who are accountable to no one. The profit motive cannot be absent from the mind of a proprietor, even though it may not be paramount. This is in the nature of a major education scandal which cannot for much longer escape the horror and disgust of the majority of Scottish people.

3.45 a.m.

The Under-Secretary of State for Health and Education, Scottish Office (Mr. Edward Taylor): In the few minutes left to me I will try to deal with some of the points raised by the hon. Member for Fife, West (Mr. William Hamilton). Dealing first with the legal position, the only statutory control over these schools arises from the requirements of Part V of the Education (Scotland) Act, 1962, that all independent schools with five or more pupils of school age on the roll must be registered with the Registrar of Independent Schools. Registration is in two stages. Before a school can open to receive pupils it must be provisionally registered. Provisional registration is granted unless the premises have already been found unsuitable or the proprietor has been disqualified from being the proprietor of a school. The school remains provisionally registered until the Secretary of State is satisfied that it can have final registration.
The hon. Member has suggested that we have not looked at this carefully. By continuing provisional registration until we are satisfied that this school comes up to the standards needed for final registration we are showing that we are watching the position carefully. The hon. Gentleman is aware that on one visit by the inspector the attention of the proprietor was drawn to certain defects, first to do with building and secondly with staff. On the following visit, some months later, there was a noticeable improvement, drawn to our attention by the inspector. There had been improvements in the arrangements in the school and

in the buildings. There were still staffing deficiencies and it was because of this that the final registration has so far been withheld. On the visit at the beginning of June, the inspector found that almost all the recommendations made by him in the previous report for improving accommodation had been attended to, at a fair cost.
Pupils had been divided into three family groups or "houses". Each group is in the charge of "house" parents and it is largely self-contained. In particular, the boys under 12 are in one group. They live, eat, work and play separately from the senior boys. The atmosphere of the school seems much happier and the behaviour of the boys no longer as aggressive as had appeared on the earlier visit. Organised excursions are run at weekends. All this is satisfactory, especially in view of the comparatively short time in which the improvement has been effected. Staffing weaknesses remain and the provisional registration will therefore continue for the present until a further visit by the inspector in September.
The hon. Gentleman has drawn attention to the fact that my hon. Friend the Secretary of State for Education and Science regards this school in a different light from that in which we in Scotland see it, because she has decided not to allow pupils from English local authorities to remain at the school. She has a specific duty, which we do not have, formally to approve the sending of any handicapped pupil to a school which is not either run by an education authority or recognised as efficient by the Department of Education and Science.
In Scotland, thanks to an amendment made by the Education (Scotland) Act, 1969, enacted by the previous Government, the Secretary of State no longer has any comparable power or duty. His responsibility in relation to a school like Corsbie Hall is limited to registration. My right hon. Friend has said that she will review the situation in the light of a decision by us to give the school final registration. In our view the school is still suffering from teething troubles which seem to be surmountable. It has not yet got the quality of staff which we think is needed for a school of this kind but the proprietor is clearly anxious to improve matters. He has already dealt


with those matters which can be dealt with quickly. He has advertised, and is advertising, for staff and is offering generous salaries. The accommodation has been greatly improved. The number of pupils is to be limited to 50 and it is intended not to admit boys who are seriously disturbed or of very low intelligence. It—

The Question having been proposed after Ten o'clock on Tuesday evening and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at eleven minutes to Four o'clock a.m.